Novig sues four states within a week of launch
Novig filed lawsuits against Massachusetts, New Mexico, New York and Washington within a week of launching sports event contracts. The company is challenging each state's authority to apply gambling laws to its prediction market offerings.
The first suit came in New York, a day after the launch. Suits in the other three states followed. Novig argues sports event contracts fall under federal oversight by the Commodity Futures Trading Commission and are not governed by state gambling law. It wants preliminary injunctions against enforcement. All four jurisdictions sought temporary restraining orders or preliminary injunctions against prediction market operators in 2026.
Wallach: odds look low, the tactic still pays
Daniel Wallach, founder of Wallach Legal, said on social media that Novig's chances of winning in Massachusetts, New York and Washington look low after recent court rulings in favour of state regulators. The strategy may still be practical. Preemptive federal suits secure more than 90 days of continuous operation and time for a possible appellate reversal.
Washington won a preliminary injunction against Kalshi in late July. The judge held that the state had shown a likelihood of success on its claim that Kalshi violated Washington's gambling law. New York is seeking $36 billion in damages from Kalshi over alleged illegal gambling. Massachusetts sued Kalshi in September last year, accusing it of taking bets without a licence. The complaint also says Kalshi lets users aged 18 to 21 trade contracts, while the betting age in the state is 21. New Mexico sued Kalshi, Inc. and KalshiEX LLC in June over unlicensed sports betting operations.
