Judge Issues Temporary Injunction Blocking Arizona's Enforcement of Gambling Laws Against Kalshi

# Federal Judge Issues Temporary Injunction Against Arizona in Kalshi Case District Judge Michael Liburdi issued a ruling in Phoenix on Friday that temporarily bars Arizona from enforcing its gambling laws against predictive market operators. The order put the brakes on a criminal wagering case that Arizona filed against Kalshi.

A Monday arraignment hearing for Kalshi was called off due to the ruling.

The ruling was issued in a lawsuit filed by the Trump administration. State prosecutors have charged Kalshi with 20 misdemeanor counts of wagering. The charges against Kalshi allege accepting bets on political outcomes, college sports, and individual player performance.

State prosecutors allege Kalshi is running an illegal gambling operation. Arizona was the first state to file criminal charges against Kalshi. The Commodity Futures Trading Commission sued Arizona in response to cease-and-desist letters sent to Kalshi from state gambling regulators.

The Commodity Futures Trading Commission sued Arizona in response to criminal charges filed against Kalshi. The commission argued Arizona is intruding on its exclusive federal power to regulate national swaps markets.

Act The judge's order stated that the federal Commodity Futures Trading Commission had sufficiently shown that event contracts fall within the Commodity Exchange Act's definition of swaps.

The judge's order stated that the Commodity Futures Trading Commission had demonstrated a reasonable chance of success in showing that the Commodity Exchange Act preempts Arizona law. The judge's order stated that the Act grants the CFTC exclusive jurisdiction over the regulation of swaps traded or executed on a Designated Contract Markets.

Kalshi operates by allowing customers to buy and sell Yes or No contracts tied to the probable outcome of an event.