Utah State Judge Denies Kalshi's Motion to Apply Federal Protection Against Gambling Laws
A U.S. district judge in Utah, Robert J. Shelby, rejected Kalshi's motion for a federal preemption defense against Utah's gambling laws and denied the prediction market's request for an injunction. The judge ruled the Commodity Exchange Act (CEA) does not preclude Utah from enforcing its anti-gambling statutes. He found the CEA's jurisdiction provisions ambiguous and stated courts typically do not find federal preemption in such situations. He also dismissed Kalshi's key argument that the Dodd-Frank Act established federal supremacy over derivatives trading as an "implausible" reading of congressional intent, noting gambling is traditionally regulated by states.
Utah's constitution strictly prohibits gambling, with online betting qualifying as a felony. A new state law adding event outcome contracts to its gambling definition prompted Kalshi's lawsuit after the governor criticized prediction markets. Utah's attorney general declared the ruling a victory, stating Kalshi "bet that clever branding would defeat Utah law. Kalshi lost, and Utah won." Kalshi's spokesperson stated the company disagrees and the fight in Utah is not over; its contracts remain available there with no enforcement action taken yet.
The New York Attorney General cited this ruling in opposing a CFTC injunction request after New York sued Kalshi last week. A gaming attorney noted an expected appeal to the Tenth Circuit would bring prediction market litigation to seven federal appellate circuits, a scale often leading to Supreme Court review. Kalshi has seen mixed results, with a Washington state court recently issuing an injunction against it but securing protections in New Jersey and Minnesota.
cryptonews.ru1 saat önce
