FlightAware Drops Kalshi Lawsuit One Day After Filing as Kalshi Removes Its Name
The abrupt dismissal leaves unanswered whether the dispute was resolved privately and what it could mean for prediction markets’ reliance on third-party data.
FlightAware abruptly abandoned its legal challenge against Kalshi before the case reached a courtroom, as the prediction market removed the flight tracker’s name from key contract-verification language at the center of the dispute.
The flight tracking company sued Kalshi on August 10 in the U.S. District Court for the Southern District of New York, accusing the exchange of using FlightAware’s data and trademark without permission to run what the complaint called “gambling markets on flight cancellations.”
By the following day, FlightAware filed a notice of voluntary dismissal. The company decided to walk away from the case and an accompanying request for a temporary restraining order seeking to stop Kalshi’s allegedly unauthorized use of FlightAware’s data and trademarks.
FlightAware filed the one-and-a-half-page notice, dated August 11, under Federal Rule of Civil Procedure 41(a)(1)(A)(i). This provision allows a plaintiff to dismiss a case unilaterally before the defendant has answered or moved for summary judgment. It doesn’t require the judge’s permission or the other side’s consent.
FlightAware dismissed the action against all four Kalshi entities without prejudice, preserving the right to bring the same claims later. The filing gave no reason. No court order, settlement agreement, or joint statement on the docket explains what changed.
Kalshi Removed Explicit Mention of FlightAware
Around the same time the case vanished, FlightAware’s name also disappeared from the market page on Kalshi. The prediction market platform altered the language used to settle the contracts in question, changing it from “verified from FlightAware” to “verified from Primary Source Agency.”
A link on those pages still directs users to FlightAware’s website. Also, a disclaimer emphasizes that any reference to the source is purely descriptive and not an endorsement or affiliation.
In its complaint, FlightAware said Kalshi never informed it that the company was using its data to determine flight-cancellation markets and to display its trademarks on the pages. The complaint noted that Kalshi opened a free “Personal” AeroAPI account in July 2022. FlightAware said the terms specifically banned commercial usage.
It also singled out a Kalshi employee, an attorney involved in defining market rules and listing criteria. The employee allegedly opened a FlightAware account on July 14, the same day Kalshi filed with the CFTC to begin offering the flight-cancellation markets.
Questions Over the Impact Prediction Markets Have on Flight Safety
The safety narrative made the complaint stand out from an ordinary licensing dispute. FlightAware argued that a market paying out on flight cancellations creates a financial incentive for people to interfere with air travel, cause cancellations, or manipulate information used to settle the markets.
Airlines for America, a trade group for major U.S. carriers, agreed with the safety concerns. The group told Good Morning America that the safety of an aviation system should never be treated as a betting market.
A Route Other Data Providers Could Take
Kalshi didn’t roll over during the brief dispute. After FlightAware canceled its data access and sent a cease-and-desist letter on July 15, Kalshi responded two days later. The company denied that it had breached any license or infringed the trademark.
It asserted that its references to FlightAware constituted nominative fair use, which lets a company name another company to truthfully describe a product.
The case dismissal means that no court will test any of the arguments. FlightAware did get one of the most visible changes it sought: its name disappeared from Kalshi’s primary verification language.
The complaint also noted that Kalshi’s CFTC filing identified U.S. Department of Transportation Bureau of Transportation Statistics data as an alternative source if FlightAware data were unavailable. That means the contracts could potentially be resolved without relying on FlightAware.
The case also clearly highlighted the larger issue of how prediction markets rely on third-party data feeds to resolve contracts and how that reliance can lead to other disputes, something other data providers might consider.
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