Rival Polymarket has filed its own lawsuit against the Bay State just days after a Massachusetts judge ruled in favor of the state’s injunction that prevents prediction-markets operator Kalshi from offering sports-event contracts.
Reversal of Fortune
Polymarket filed a lawsuit against Massachusetts Attorney General Andrea Joy Campbell earlier this week, arguing that prediction-trading platforms prohibited from offering sports event contracts by state gaming authorities violate federal law.
Polymarket’s legal argument resembles that of Kalshi and many of its competitors regarding its status as a licensee of the federal authority of the Commodity Futures Trading Commission (CFTC), whose authority supersedes that of any state agency.
Polymarket Chief Legal Officer Neal Kumar has stated that the disruption of the sports event contracts offered by prediction platforms in any state will have a deleterious impact on the entire industry.
Kumar stated that gaming commissions “racing to state court to try to shut down Polymarket US and other prediction markets doesn’t change federal law.” He also added that Massachusetts and Nevada will “miss an amazing opportunity to help build markets for tomorrow.”
Kalshi Suffers Setbacks
After scoring several early legal victories, particularly in federal courts, the industry’s leading prediction market, Kalshi, has suffered legal losses in Nevada and, most recently, in Massachusetts.
This has triggered Polymarket’s call to action in taking these matters into court and continuing the industry’s legal rampage against state gaming commissions.
Massachusetts previously won a preliminary injunction against Kalshi from offering sports event contracts. But the company countered by asking a state judge to allow it to continue while its appeal was filed. Suffolk County Superior Court Judge Christopher Barry-Smith, however, derailed that effort by ruling against staying the injunction.
The judge agreed with Massachusetts Attorney General Andrea Joy Campbell that any entity operating without a state gaming license but offering odds on sports events is running afoul of Massachusetts law.
Moreover, the Nevada Gaming Control Board recently scored legal victories over Kalshi and, most recently, Polymarket, prohibiting both from offering sports event contracts in the Silver State via temporary restraining orders. However, appeals have already been filed in federal court.
