Press Article: Kalshi Secures Legal Win Against NJ State Gaming Regulator
In a significant legal victory for the prediction markets platform Kalshi, the US District Court for New Jersey has issued a temporary restraining order (TRO) and a preliminary injunction against the New Jersey Division of Gaming Enforcement (NJDGE). This ruling comes in response to a cease-and-desist order issued by the NJDGE, which sought to halt Kalshi’s sports contract offerings on the grounds that they constituted unauthorized sports betting under state law.
Kalshi contended that it operates under the jurisdiction of the Commodity Futures Trading Commission (CFTC) at the federal level, arguing that state agencies like the NJDGE lack the authority to impede its operations. The court appeared to agree, with Judge Edward Kiel stating, “I am persuaded that Kalshi’s sports-related event contracts fall within the CFTC’s exclusive jurisdiction,” rejecting the NJDGE’s assertion that these contracts are non-financial.
Sara Slane, Kalshi’s head of corporate development, expressed gratitude for the court’s ruling, reaffirming the company’s commitment to educating regulators about the legality and benefits of prediction markets. This ruling aligns with Kalshi’s ongoing legal challenges, as the company has also filed suits against the Nevada Gaming Control Board (NGCB) and the Maryland Lottery and Gaming Control Commission (MLGCC).
Notably, Kalshi recently achieved a similar victory against the NGCB, with the court siding with its request for a preliminary injunction. Meanwhile, Crypto.com is also pursuing legal action against the MLGCC, arguing that recent orders could irreparably harm its operations.
As the landscape of prediction markets evolves, Kalshi’s legal battles spotlight the ongoing tensions between state and federal regulatory frameworks. The outcomes of these cases may shape the future of such platforms in the United States.
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