Massachusetts Suffolk County Superior Court Judge Christopher Barry-Smith made a key ruling, approving the state Attorney General Andrea Campbell's request for a preliminary injunction against the prediction market platform Kalshi. This injunction will take effect on Friday, prohibiting Kalshi from offering sports-related contract betting services in the state without a sports betting license. The judge noted that Kalshi's services "resemble other digital gambling experiences," also using gambling terminology, and include single-event bets and parlay contracts, essentially constituting unlicensed sports gambling. Campbell had filed a lawsuit against Kalshi in September, and this victory maintains the enforcement baseline for state regulatory agencies. Related prediction market litigation cases and compliance standards can be referenced on the PASA official website.
Injunction Core: Unlicensed Operation is the Key Issue
The issuance of this preliminary injunction centers around the compliance issues of Kalshi:
Judge's ruling reason: Barry-Smith in his ruling clarified that Kalshi's sports contract services are highly similar to gambling, not only using gambling-related terminology, but its offerings of single-event bets (proposition bets) and parlay contracts fully comply with the characteristics of sports gambling;
Attorney General's core demand: Campbell emphasized that sports gambling poses risks of addiction and financial loss, requiring strict regulation. Kalshi must obtain a license and comply with state law if it wishes to operate in Massachusetts;
Subsequent procedures: The injunction will officially take effect on Friday, and a hearing may be held on the same day if any party applies. Kalshi has the right to appeal the decision, but has not yet responded to requests for comment.
It is noteworthy that Campbell mentioned that Kalshi's revenue from sports betting even exceeds that of regular sports gambling operators like DraftKings and FanDuel.
Multistate Litigation Entanglement: Kalshi Caught in National Legal Struggle
The Massachusetts injunction is not an isolated case, as Kalshi is currently mired in lawsuits in multiple states across the US, with significant differences in court decisions:
Nevada: Initially, a judge granted Kalshi an injunction against the state, but reversed the decision in November, allowing state regulators to classify sports contracts as illegal gambling. The judge criticized Kalshi's interpretation of the "Commodity Exchange Act" as "far-fetched," attempting to evade state regulation and contradicting decades of federal regulatory tradition;
Maryland: Made a similar ruling to Nevada, deeming Kalshi's services as suspected illegal gambling;
New Jersey: A federal judge granted Kalshi a preliminary injunction against state regulators, and the case has now been appealed to the United States Third Circuit Court of Appeals, with Campbell being one of the 34 attorneys general supporting New Jersey's regulatory stance;
Other states: New York and Ohio have also filed lawsuits against Kalshi, with several other states issuing cease and desist orders.
The only positive news comes from California, where a local judge in November dismissed the demands of tribal groups, determining that CFTC regulation of prediction markets means their services do not constitute gambling and do not violate the "Indian Gaming Regulatory Act."
Industry Chain Reaction: Leading Operators Entering Raises Regulatory Alarms
The litigation storm behind Kalshi reflects the industry's shake-up caused by the blurred boundaries between prediction markets and sports gambling:
Leading players follow-up: Mainstream sports gambling operators like DraftKings and FanDuel have begun launching their own prediction market platforms across the US;
Regulatory warning risks: State regulatory agencies have explicitly issued warnings, these leading operators' similar products may jeopardize their sports gambling licenses, as the compliance risks of unlicensed operation have been fully demonstrated through Kalshi's case;
Industry boundary disputes: The core dispute in this multistate litigation still revolves around whether sports contracts in prediction markets constitute sports gambling, with differences among states and courts also reflecting the lack of regulatory standards in this field.
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