Fanatics boss and betting CEO allegedly invested in Kalshi while building rival prediction market product

• Unsealed court documents allege Fanatics founder Michael Rubin and betting CEO Matt King personally invested in Kalshi before launching Fanatics Markets in December.
• The claims emerged from a lawsuit Fanatics filed against departing executive Ari Borod, who left to join competitor Polymarket as President of Sports Business Development.
• The two companies settled the dispute on February 2, but the filings have exposed alleged conflicts of interest at the top of one of America’s largest sports betting companies.

Fanatics founder Michael Rubin and betting CEO Matt King personally invested in prediction market platform Kalshi before their own company launched a competing product, according to unsealed court documents.

The allegation has emerged from a legal battle Fanatics launched against a departing executive, a dispute that has inadvertently placed the company’s own leadership under scrutiny.

The claims surfaced in filings from Ari Borod, Fanatics’ former Chief Business Officer, who left the company in January to join rival prediction market platform Polymarket as President of Sports Business Development. Fanatics sued to block the move, citing a noncompete agreement. Borod’s legal team hit back, and in doing so, revealed details that reach well beyond the employment dispute itself.

Investments in a direct competitor

As reported by Front Office Sports, Borod’s said in a filing that Rubin and King “invested personally into Kalshi” before Fanatics launched Fanatics Markets in December 2025, a product that puts the company in direct competition with Kalshi.

Neither Fanatics nor Kalshi has commented publicly on the allegation. A representative for Kalshi declined to respond when contacted by Front Office Sports.

The claim raises pointed questions about potential conflicts of interest at the leadership level. Rubin has been openly complimentary about Kalshi and Polymarket in public, describing their respective CEOs, Tarek Mansour and Shayne Coplan, as “studs.”

At the same time, he has publicly backed sportsbooks to win the prediction market race, stating:

“I think the winners of this are going to be the sportsbooks. We have such strategic advantages from the enormous customer base that we have to all of the experience.”

That combination, personal investment in a competitor alongside simultaneous development of a rival product, is now a matter of public record, even if neither Fanatics nor Kalshi has addressed it directly.

A lawsuit that revealed more than intended

The investments came to light as a byproduct of the noncompete lawsuit Fanatics filed against Borod on January 12 in Florida state court. The company argued he had access to confidential information related to its prediction market expansion and was bound by a one-year noncompete clause.

Borod disputed this, and his legal team described the action as retaliatory. A court filing stated:

“Fanatics brought this meritless action to punish Defendant Aron Borod for doing what he had every right to” — leave the company to join Polymarket.

His filing added that “Borod’s agreement, however, simply has no such provision,” referring to the noncompete clause Fanatics sought to enforce.

Fanatics had made clear it would not stand aside. When Borod informed the company in December of his intention to leave, it made a counteroffer to encourage him to stay. When he declined, the company warned that “the entire weight of Fanatics would be brought against him.” He joined Polymarket on January 2. The lawsuit followed ten days later.

The two sides reached an out-of-court settlement on February 2. A Polymarket spokesperson confirmed:

“The parties have reached an out-of-court resolution of their dispute and have no further comment.”

Exchange acquisition also alleged

The unsealed filings contain a further disclosure. Borod stated that Fanatics leadership had been engaged in discussions to acquire a Designated Contract Market (DCM) exchange, the type of regulated trading infrastructure operated by platforms like Kalshi and Polymarket.

He claimed limited involvement in those talks and said he remained unaware of the key commercial terms or the identity of the target.

“While I knew that other members of Fanatics’ leadership team were engaged in discussions to acquire a DCM exchange, and had participated in high-level calls on the subject, I was genuinely unaware, prior to this lawsuit, that FMX had agreed to terms with a target exchange,” Borod said in his filing.

“To date, I still do not know the principal financial and commercial terms of the deal, or the name of the target exchange.”

If accurate, the disclosure suggests Fanatics has been quietly pursuing a deeper structural foothold in the prediction market space, even as its executives held personal stakes in an existing platform operating in the same market.

Fanatics mirrors its own critics

The case also carries an ironic dimension. When Fanatics hired executive Michael Hermalyn away from DraftKings, DraftKings pursued legal action citing a noncompete violation. Fanatics is now deploying the same legal strategy it once faced, in a dispute that has arguably produced far more damaging disclosures than the original employment matter.

With Borod now in post at Polymarket and tasked with building sports partnerships, the prediction market sector’s expansion into mainstream sports entertainment continues. The Kalshi investment allegation, unaddressed and undenied, leaves an open question over how the industry’s biggest players are managing the line between competition and personal financial interest.

In other news

The lawsuit arrives at a pivotal moment for Fanatics’ broader ambitions in the betting and prediction market space. The company launched Fanatics Markets across 10 US states in late 2025 and had previously partnered with Crypto.com to build out its prediction market offering.

On the sportsbook side, a single high-volume bettor helped Fanatics surpass FanDuel in August handle, while the company has continued to build its compliance infrastructure, deploying OpenBets’ Full Protect suite to strengthen regulatory safeguards.

Fanatics has also moved aggressively on its casino vertical, securing a content deal with S-Gaming as US expansion accelerates, and raised its brand profile with a Super Bowl campaign featuring Kendall Jenner.