A federal judge has denied Kalshi's request to block New York from enforcing its gambling laws against the prediction market platform amid its ongoing battle against state regulators.
In a Tuesday ruling, Southern District of New York Judge Analisa Torres denied Kalshi's motion for a preliminary injunction in the lawsuit filed by the prediction market platform against the New York State Gaming Commission. Kalshi has since appealed the decision to the Second Circuit.
The dispute primarily centers on whether Kalshi's sports-event contracts fall under federal regulation or state gambling laws. The state gaming regulator argues that the contracts violate state gambling laws, while Kalshi contends that the federal Commodity Exchange Act (CEA) preempts those laws.
"[The] Court finds that New York gambling laws as applied to Kalshi's sports-event contracts are not preempted by the CEA and Kalshi has not, therefore, made a clear or substantial showing that it is likely to succeed on the merits," Judge Torres wrote in the order.
The judge noted that the CEA still allows states to regulate certain related issues arising from trading swaps and other financial products on designated contract markets.
