Written by :
Published on :
Highlights
Judge John McHale of the King County Superior Court said the state showed "a likelihood of actual and substantial injury to Washington consumers from illegal gambling activities" if no injunction (against Kalshi) were issued.
"States don't have jurisdiction to regulate prediction markets," Kalshi said in a statement on Tuesday. "We're disappointed to see Washington state continue wasting taxpayer dollars."
Other states have had success blocking Kalshi, but the prediction market has had a few wins of its own
SEATTLE (Gambling911.com) - The popular prediction market Kalshi was dealt a serious blow in the state of Washington on Monday.
Judge John McHale of the King County Superior Court granted Washington's motion for a preliminary injunction, ruling that the prediction markets platform likely violated the state's gambling laws.
As such, McHale granted Washington's request to block Kalshi from offering its so-called event contracts.
Washington has, without question, one of the most draconian online gambling laws in the books....and we're not talking about some law from the 1800's.
Under state law enacted in 2006, knowingly placing a bet over the internet with a gambling operator can be prosecuted as a Class C felony. Nobody has ever been charged with violating this law....and probably never will be.
McHale said the state showed "a likelihood of actual and substantial injury to Washington consumers from illegal gambling activities" if no injunction were issued. He also said the public interest and potential harm to consumers outweighed harm to Kalshi.
"States don't have jurisdiction to regulate prediction markets," Kalshi said in a statement on Tuesday. "We're disappointed to see Washington state continue wasting taxpayer dollars."
A Mixed Bag for Kalshi Thus Far
Washington joined Massachusetts, Michigan and Nevada in winning court orders restricting Kalshi's activities.
New York won a similar order on July 8, when a federal judge rejected Kalshi's bid to block enforcement of that state's gambling laws against the platform.
The U.S. Commodity Futures Trading Commission, meanwhile, has claimed exclusive jurisdiction over the industry, and challenged regulatory activity in at least nine states.
In April, a divided federal appeals court cited the CFTC's authority in blocking New Jersey gaming authorities from regulating Kalshi's sports event contracts. There is an irony here in that New Jersey was the driving force behind the U.S. Supreme Court abolishing PASPA (the Professional and Amateur Sports Protection Act). Without New Jersey's persistence, legal sports betting in the U.S. likely would have been delayed by many years.
Kalshi has also enjoyed a victory in Tennessee.
After the Tennessee Sports Wagering Council issued a cease-and-desist order, Kalshi obtained first a temporary restraining order and then a preliminary injunction blocking Tennessee from enforcing its sports-gambling laws against the exchange.
The federal court accepted, at least preliminarily, Kalshi’s argument that sports-event contracts are federally regulated swaps and that state enforcement is likely preempted.
- Mary Montgomery, Gambling911.com
