Coalition of 36 State Attorneys General Take Aim at Kalshi, Sports Prediction Market Operator
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It's a hot legal battle between 36 state attorneys general and Kalshi, a sports prediction market operator. The coalition has filed strong opposition against Kalshi in a New Jersey court case, questioning the company's operations.
The Escalating Controversy
- Kalshi is currently entangled in lawsuits across several states, including New Jersey, Nevada, and Maryland.
- In Nevada, Kalshi continues to operate as a designated contract market (DCM) granted by the Commodity Futures Trading Commission (CFTC), with a preliminary injunction preventing state regulators from enforcing laws against the company. This is based on a federal preemption argument regarding the exclusive jurisdiction of CFTC over these markets.
- The Nevada case is on its way to the U.S. Court of Appeals for the Ninth Circuit, with further cross-motions and appeals anticipated.
- In New Jersey, the case has escalated to the U.S. Court of Appeals for the Third Circuit, attracting numerous amicus briefs from various stakeholders, including the coalition of 34 state attorneys general.
- A recent case in Maryland is still under consideration for a temporary injunction.
The Role of the Coalition of State Attorneys General
- The coalition of 34 state attorneys general has filed amicus briefs against Kalshi in the New Jersey case, underscoring their significant concerns over the company's operations.
- These bipartisan attorneys general strive to reinforce state-level regulatory authority and collectively oppose Kalshi's sports prediction markets, as many states view them as an infringement on their sovereignty and regulatory regimes, particularly concerning sports gambling and event contracts.
The Wider Implications
- Alongside this coalition, a comprehensive tribal coalition of over 60 tribes and nine organizations also opposes Kalshi's operations, arguing that they infringe upon tribal sovereignty under the Indian Gaming Regulatory Act.
- Kalshi has managed to secure some court victories asserting federal preemption and challenging state enforcement actions, but the legal battles remain ongoing and involve multiple appeals across various jurisdictions.
In essence, Kalshi's sports event market operations continue to face strong opposition from multiple state attorneys general across the United States, as the legal battle moves through appellate courts. The implications of this ongoing controversy could shape the regulatory landscape of sports prediction markets significantly.
- The coalition of 34 state attorneys general has filed amicus briefs against Kalshi's sports betting operations, expressing concerns about its impact on state-level regulations and sovereignty regarding sports gambling and event contracts.
- The ongoing legal battles surrounding Kalshi's sports event markets, such as the ones in New Jersey and Maryland, could have significant implications for the regulation of sports betting and prediction markets nationwide.
