New York judge denies CFTC emergency request to block New York State lawsuit against Kalshi

Odaily News – New York Judge Jed S. Rakoff has denied the emergency temporary restraining order request filed by the U.S. Commodity Futures Trading Commission (CFTC), which sought to block New York State from continuing its enforcement case against prediction market operator Kalshi. The ruling dismissed the request without prejudice, and the CFTC may resubmit its motion to Judge Victor Marrero on August 7.



Rakoff held that the CFTC failed to demonstrate a substantial likelihood of success on the merits, nor did it establish irreparable harm. New York Attorney General Letitia James filed a lawsuit against Kalshi last Friday, alleging that the company operates an illegal and unlicensed gambling business by offering contracts tied to sports, elections, and other events.



The New York State Gaming Commission had already issued a cease-and-desist order to Kalshi in October 2025. The case centers on whether federal commodities law preempts state-level gambling enforcement over event contracts, with state regulators arguing that the relevant contracts constitute wagering, while the CFTC and Kalshi maintain that they are derivatives subject to the CFTC's exclusive jurisdiction.