A court order barring a major company in the rapidly expanding sports-betting market from doing business in Massachusetts went into effect on Friday.
It’s the latest twist in protracted litigation that began in September when Attorney General Andrea Campbell sued the company, Kalshi.
In her lawsuit, Campbell said Kalshi was operating an online “prediction market” that allows people to bet on the outcome of sporting events — without being licensed for sports betting in Massachusetts.
Prediction markets operate like financial futures markets, allowing participants to buy and sell “event contracts” — essentially making bets — based on their expectations.
In response to Campbell‘s lawsuit, New York-based Kalshi argued it wasn’t subject to state law because it is federally regulated, and federal law preempts state law.
But Judge Christopher K. Barry-Smith of Suffolk Superior Court last month rejected that argument and granted a preliminary injunction — which would bar Kalshi from conducting business in the state while the underlying issues are further litigated in what could take months or even years.
Barry-Smith, however, delayed implementation of his preliminary injunction to consider Kalshi’s request for a stay while it appeals his ruling. On Friday, Barry-Smith said no to the stay.
Campbell welcomed the preliminary injunction. “Today’s court order affirms Massachusetts’ right to enforce our gambling laws and hold all operators who wish to offer sports wagers in our state accountable,” she said in a statement.
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