Kalshi Seeks Single Judge for NY Prediction-Market Cases

On May 13, prediction-market platform Kalshi filed in the Southern District of New York asking Judge Analisa Torres to designate three cases as related: the Commodity Futures Trading Commission’s suit against New York and Attorney General Letitia James’s suits against Coinbase and Gemini. Kalshi said the cases raise the same legal question under the Commodity Exchange Act about whether federal law preempts New York’s gambling statutes for event contracts traded on designated contract markets.

Kalshi invoked Rule 13 of the court’s Rules for the Division of Business Among District Judges and warned of a “significant risk of conflicting orders” if different judges independently address the federal preemption issue. The company added that if the court deems the matters related it would “promptly confer with counsel in those actions concerning potential consolidation,” which could affect briefing schedules and the order of motions.

In its filing Kalshi cited inconsistent federal rulings on whether event contracts fall exclusively under CFTC jurisdiction or whether states may apply gambling laws. The company identified favorable decisions from the Third Circuit and federal courts in Arizona and Tennessee and pointed to contrary outcomes in Nevada and Ohio.

New York’s attorney general filed an opposition on May 14, characterizing Kalshi’s request as an attempt to circumvent procedural rulings by Judge Victor Marrero. The state noted that Marrero, who is overseeing the Coinbase, Gemini and CFTC matters, had postponed consideration of expected consolidation motions until after pending motions to remand the Coinbase and Gemini cases to state court were resolved. The opposition argued Kalshi’s effort “will end‑run the existing adjournment of anticipated motions to consolidate the cases pending before Judge Marrero until he addresses remand, and is contrary to the interests of justice.”

The state also observed that while related-case notices were filed in the Coinbase and Gemini matters, the CFTC did not seek to relate those actions to Kalshi’s suit. New York pointed out that Kalshi waited nearly three weeks after the related cases were assigned to Judge Marrero before filing the relatedness notice with Judge Torres, by which time Marrero had set briefing schedules and motion sequencing.

If the court grants related status and the parties pursue consolidation, the timing and scope of dispositive motions and remand disputes could shift and a single judge would likely address the central CEA preemption question. The legal issue involves whether event contracts traded on designated contract markets are governed solely by the federal Commodity Exchange Act and the CFTC or whether New York may apply state gambling laws to those contracts.