Connecticut judge denies Kalshi emergency injunction, says CFTC cannot override court
A Connecticut judge denied Kalshi's emergency motion for an injunction pending appeal. The company sought to use the Commodity Futures Trading Commission (CFTC) to override a court decision blocking its sports event contracts. The judge's order states that the CFTC cannot override the court. The ruling leaves Kalshi without interim relief while it pursues an appeal. The decision deepens the platform's exposure in a state where it already faces a separate ruling that its sports contracts are not swaps.
The denial strands Kalshi without interim protection in a state where it already lost on the merits. Traders holding open contracts face immediate geography-dependent validity questions, not a stay during appeal. Each state court loss forces the same costly choice: build geofences or watch contracts void under local gambling law. Kalshi's national expansion assumed CFTC registration would block state enforcement.
That assumption is collapsing market by market. Legal spend now stacks across parallel cases in Washington, Connecticut, New York, Utah, and Wisconsin with no uniform standard in sight. The appeals pipeline offers the only path to clarity, but circuit splits take months or years to resolve. Rivals like Polymarket face identical exposure, and brokerages clearing these contracts must reassess whether distribution partnerships carry downstream liability.