New Jersey asks Supreme Court to take up prediction market fight

New Jersey is urging the Supreme Court to intervene in a legal battle over prediction markets, arguing they should not be exempt from state gambling laws. Attorney General Jennifer Davenport stated that platforms like Kalshi operate nationwide without adhering to any state's gambling regulations, which she believes Congress did not intend. The state's petition seeks to overturn a prior appellate court decision that found federal law supersedes state regulations for these platforms, designating the Commodity Futures Trading Commission (CFTC) as the exclusive regulator.

This legal challenge comes at a time when differing rulings from appellate courts have created a split, increasing the likelihood of the Supreme Court taking up the issue. Legal experts suggest that the conflicting decisions, including one that found Kalshi not immune from Nevada's gaming laws, make Supreme Court involvement highly probable. New Jersey's action is part of a broader effort to ensure states retain the authority to decide whether to permit sports wagering within their borders, a principle that Davenport argues is upended by the current operation of prediction markets.

Currently, 39 states offer some form of sports betting, while others prohibit it. Kalshi spokesperson Dani Lever expressed disagreement with New Jersey's appeal, stating the company cannot be regulated by 50 different regulators and remains confident in the lower courts' rulings.