TechFlow News, March 11: According to The Block, Chief Judge Sarah D. Morrison of the U.S. District Court for the Southern District of Ohio dismissed Kalshi’s motion for a preliminary injunction. Kalshi had sought to block Ohio regulators from enforcing state gambling laws against its event contracts.
In her ruling, the judge stated, “Historical evidence indicates that Congress did not intend for federal law to preempt state sports gambling laws.” Kalshi argued that its event contracts fall under the Commodity Exchange Act (CEA), which is enforced by the Commodity Futures Trading Commission (CFTC), and that federal authority should therefore preempt state law. However, the judge cited the legislative context surrounding the 2010 Dodd-Frank Act amendments, noting there is no evidence that Congress intended for the CEA to preempt sports gambling laws.
Last year, the Ohio Casino Control Commission accused Kalshi of operating illegal sports gambling in the state. A Kalshi spokesperson said the company will appeal the decision, pointing out that this ruling contradicts a judgment issued just weeks earlier by a federal court in Tennessee. The outcome of this case could affect the legal outlook for other prediction market platforms, including Polymarket.
