FlightAware Sues Kalshi Over Unauthorized Data Use in Flight Betting
The flight-tracking service seeks damages and an injunction after Kalshi used its data to power betting markets on flight cancellations.
Flight-tracking service FlightAware has filed a lawsuit against prediction market platform Kalshi in the Southern District of New York. The legal action, filed on August 11, 2026, alleges that Kalshi used proprietary data and trademarks without authorization to facilitate betting on aviation disruptions.
FlightAware claims Kalshi violated specific terms of service that prohibit the use of its data for commercial or gambling purposes. The company is seeking monetary damages and a permanent injunction to force Kalshi to cease using its brand and data streams. According to the filing, FlightAware maintains that no company is, or will be, authorized to use the network's data for such purposes.
The Betting Markets
The dispute stems from contracts Kalshi introduced in July 2026, which allowed users to wager on the percentage of flights cancelled at specific airports. To settle these bets and verify outcomes, Kalshi cited data from FlightAware and the U.S. Department of Transportation. This move comes as Kalshi continues to navigate separate legal challenges from the New York Attorney General regarding allegations that the platform operates an illegal gambling operation.
Industry Implications
This case underscores a growing legal tension between specialized data providers and the emerging prediction market industry. At the heart of the conflict is the boundary between 'nominative fair use'—where a company mentions a brand to describe a fact—and the unauthorized commercial exploitation of proprietary data. For data providers, the unauthorized use of their infrastructure to power financial instruments represents a significant breach of licensing agreements and a loss of control over intellectual property.
Safety and Security Concerns
Beyond the licensing dispute, FlightAware has raised alarms regarding the real-world impact of these markets. The company expressed concern that creating direct financial incentives for flight cancellations could inadvertently encourage the mass disruption of air travel. By turning aviation delays into a tradable asset, the service argues that the platform may create perverse incentives that threaten the stability of flight operations.
What's Next
The court will now determine whether Kalshi's use of the data constitutes a breach of contract or trademark infringement. Observers will be watching to see if the ruling establishes a stricter precedent for how prediction markets must license the third-party data they use to settle contracts. It remains to be seen how Kalshi will defend its data sourcing practices in the face of these allegations.