Federal Judge Dismisses Kalshi’s Federal Protection Claims in Utah Anti-Gambling Lawsuit

Odaily Planet Daily reports: U.S. District Judge Robert J. Shelby ruled that the Commodity Exchange Act does not preempt Utah’s application of its anti-gambling laws to Kalshi’s sports event contracts, and granted Utah’s motion for summary judgment, denying Kalshi’s motion for a preliminary injunction. Shelby stated that the preemption clause of the Commodity Exchange Act admits multiple reasonable interpretations, and under such circumstances, courts typically do not favor federal preemption. He also rejected Kalshi’s argument that amendments under the Dodd-Frank Act established federal preemption over derivatives trading. Kalshi spokesperson Jacki McGavick said the company disagrees with the ruling and plans to appeal to the Tenth Circuit Court of Appeals. Currently, Utah users may still access sports event contracts, and no enforcement action has been initiated by the state. The New York Attorney General has already cited this ruling as additional grounds within a day to oppose the CFTC’s motion for a preliminary injunction against New York State. Previously, New York State sued Kalshi last week, alleging it operated as an unlicensed gambling operator.