New York Judge Denies Kalshi Emergency Injunction

U.S. District Judge Analisa Torres of Manhattan on Monday denied Kalshi’s emergency injunction request for the second time this month, refusing to block New York gaming regulators from acting against the prediction market for offering sports-event contracts. Torres issued a three-page order.

Kalshi filed a second injunction motion on July 15, asking the court to pause state enforcement while it appeals to the U.S. Court of Appeals for the Second Circuit. The New York State Gaming Commission agreed to refrain from enforcement until Thursday to give Kalshi time to seek relief.

Torres said Kalshi’s new filing largely repeated arguments the court already considered and sought the same relief she had previously denied. She wrote that the company asked for “something even more ‘drastic’ than a routine injunction pending appeal — it seeks the very injunctive relief that (this) court already denied.”

The judge added that defendants had identified “significant harms associated with halting their efforts to enforce state gaming regulations,” and she cited the legal reasoning from her July 9 order.

In its appeal to the Second Circuit, Kalshi argues that federal law preempts state gambling rules and that, without a pause, it faces “irreparable harm” from choosing between potential criminal exposure under state law and its federal obligations as a CFTC-regulated entity. New York must file its response with the appeals court by Tuesday.

Earlier on Monday, U.S. District Judge Katherine Menendez in Minnesota issued a different ruling. Menendez temporarily barred Minnesota from enforcing a law that would have banned prediction markets after finding the Commodity Futures Trading Commission had shown a likelihood of success on its preemption claim.

Menendez wrote in a 44-page order that operators including Kalshi and Polymarket had shown they faced business harm and the prospect of criminal prosecution under the new state law. She also said that some contracts on those platforms might not meet federal standards for trading on an exchange: “If they don’t fit, Plaintiffs have much weaker claims that the CFTC is the only authority that can regulate them.”

Kalshi has appealed to the Second Circuit. The Minnesota case remains in the district court under Menendez’s temporary order while the litigation proceeds.