Washington judge moves to halt Kalshi sports contracts under state gambling law

Court backs state request

In granting Washington’s request, the court found that Kalshi’s sports event contracts amount to illegal gambling activity under state law. The judge wrote that Kalshi “offers illegal gambling activities to Washington consumers and solicits bets from Washington consumers on its platform.”

The court also concluded that the balance of harms favored the state. According to the ruling, the public interest and consumer protection concerns outweighed the potential damage the injunction could cause Kalshi.

Order delayed pending more briefing

Although the judge approved the preliminary injunction, it will not take effect immediately. The court built in a delay to allow additional briefing from both sides.

Further submissions from Kalshi and from the state are due by Aug. 3. As a result, the injunction could take effect no earlier than Aug. 5.

That delay means the dispute is not fully settled, even though Washington secured an initial win on its request for emergency relief.

Federal preemption argument rejected

A central issue in the case is whether Kalshi’s sports contracts are governed exclusively by federal law or can still be challenged under Washington’s gambling statutes. Kalshi has argued that the Commodity Exchange Act preempts state law.

The judge rejected that position at this stage, stating that the CEA does not preempt Washington law. That finding underpins the court’s decision to let the state proceed in restricting the company’s sports-related offerings within its borders.

Kalshi has expressed disappointment with the outcome. A spokesperson for the company said it was disappointed by the ruling and noted that the firm remains involved in legal fights in other states over the same broader issue.

Part of a wider state-by-state fight

The Washington case is the latest development in a broader national dispute over Kalshi’s business model, particularly its sports event contracts. The company has faced similar pressure elsewhere, with previous actions noted in Michigan and New York.

Those disputes have turned on the same core question now at issue in Washington: whether Kalshi’s products should be treated primarily as federally regulated event contracts or as activity subject to state gambling enforcement.

The preliminary injunction does not end the case, but it does give Washington a temporary victory and signals how at least one court is viewing the conflict between Kalshi’s federal-law defense and state gambling restrictions.