Just days after agreeing to halt sports-event contracts in Nevada, prediction market operator Kalshi was dealt another blow in New York.
Key Takeaways
- Judge Analisa Torres said Kalshi didn’t show enough reason to overrule her previous decision.
- Kalshi is trying to avoid civil penalties in the Empire State.
- New York’s attempt to ban Kalshi’s sports-event contracts in the state continues.
U.S. District Judge Analisa Torres of the Southern District of New York denied the trading exchange company’s emergency injunction appeal Monday to avoid penalties from Empire State regulators while the legal dispute continues.
JUST IN: Kalshi's motion for an emergency injunction pending appeal has been denied by Southern District of New York federal judge Analisa Torres, who concludes that Kalshi cannot make the requisite “strong showing” that it is likely to succeed on the merits of its appeal. pic.twitter.com/XBHltbFJxE
— Daniel Wallach (@WALLACHLEGAL) July 27, 2026
“Kalshi offers no new authority that would cause the court to now conclude that Kalshi has made a ‘strong showing’ of success on the merits,” Torres wrote in the ruling document.
The New York State Gaming Commission is seeking to stop Kalshi from offering sports-event contracts, arguing they violate state gaming laws. Kalshi was denied a temporary restraining order and preliminary injunction by Torres on July 7 and filed the emergency motion request July 15.
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Torres doubles down
In her denial Monday, Torres said Kalshi is seeking “something more ‘drastic’ than a routine injunction pending appeal,” and is instead seeking injunctive relief that the judge already denied.
“The Court held in the PI Order that Kalshi has not met its burden with respect to any of the four factors to be considered when adjudicating a motion for preliminary injunction,” Torres wrote in the court order document. “Kalshi’s motion does not change this, and it does not point to any unusual or compelling circumstances which justify Kalshi’s requested relief.”
Torres also dismissed Kalshi's reliance on the Commodity Futures Trading Commission's proposed rule that states that the Commodity Exchange Act preempts state law for certain event contracts. Torres also pointed to a similar lawsuit from April in Ohio, where an appeals court similarly concluded, at the emergency stage, that federal law did not preempt Ohio's gaming laws.
What’s next in N.Y.?
Kalshi’s legal battle with New York isn’t over, but the situation could be headed to a clearer resolution soon. Kalshi is still awaiting a ruling for its immediate injunction appeal from the Second Circuit court. Gaming attorney Daniel Wallach recently said that a decision is likely coming this week.
This week's expected ruling from the 2nd Circuit on Kalshi's emergency motion for an immediate injunction pending appeal is huge. If the CA2 denies Kalshi's motion, Kalshi will likely be forced to block sports trades in New York within the next 90 days. https://t.co/tbxtvhH2xO
— Daniel Wallach (@WALLACHLEGAL) July 27, 2026
A favorable ruling for the state could force Kalshi to block trades on its platform. Regardless, New York Attorney General Letitia James has already said the state won’t subject Kalshi to any civil penalties while the dispute awaits a full resolution.
New York has been at odds with Kalshi since sending a cease-and-desist letter to the operator in October 2025. Kalshi responded by filing a lawsuit to continue offering sports contracts. James has been vocal about the lack of consumer protections surrounding prediction market platforms.
Other legal battles
New York is just one of at least a dozen states that Kalshi is battling in court, but the Empire State is the most lucrative for legal U.S. sports betting.
Kalshi agreed on July 24 to stop offering sports contracts in Nevada and implement geofencing by Aug. 12. The decision came after the state’s gaming control board found Kalshi to be in contempt of a court order by continuing to offer banned markets.
A judge in Washington ruled in favor of the state last week, barring Kalshi from offering sports contracts within the jurisdiction after finding that the trading exchange was violating state gambling laws.
Kalshi did pick up a win in Minnesota on Monday when a federal judge granted a preliminary injunction against the state to keep officials from taking action against prediction market operators. This lawsuit was backed by the CFTC, which has sued nine states this year.
