Kalshi loses emergency injunction bid in Utah

Kalshi faced another legal defeat whit its request denied for emergency relief by the Tenth Circuit Court of Appeals in Utah. This Denver-based court ruled that Kalshi had not satisfied the requirements for an injunction pending appeal. To obtain the emergency relief, the company needed to demonstrate a possibility of winning, irreparable harm, little harm to the other party, and public interest. Kalshi applied for the injunction after a lower court permitted Utah to implement its anti-gambling regulations against the prediction market while the case is still in progress. Attorney General Derek Brown’s office was pleased with the decision, but did not indicate if the enforcement against Kalshi and other prediction markets would be commenced. The core issue in the case is whether Kalshi sports-event contracts are gambling under Utah law or they are financial products regulated only by federal Commodities law under the Commodity Futures Trading Commission. Utah is one of the states with the strictest anti-gambling regulations in the country, as there is a prohibition on gambling laid down in the state Constitution. The ruling from Utah only amplifies the legal pressures mounting on the companies that run prediction markets and sell sports contracts. Recently, Michigan got its second preliminary injunction against Kalshi for offering sports contracts. This prohibition requires Kalshi to geofence the state of Michigan while ensuring fines up to $500k for any breaches. Nevada has also achieved a major ruling, when on August 28th, the Ninth Circuit Court held that Nevada could continue to enforce its gambling regulations against the sports event contracts of Kalshi.