New Jersey is asking the U.S. Supreme Court to decide a dispute over prediction markets and the laws regulating betting on sporting events.
The state’s attorney general, Jennifer Davenport, filed a 332-page petition Wednesday asking the nation’s highest court to rule on whether prediction markets can offer wagers without following state sports-gambling laws.
It’s the first such petition regarding the legality of prediction markets like Kalshi and Polymarket offering self-certified sports event contracts without state gaming licenses.
Ms. Davenport wants to know whether the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, a sprawling financial-reform law, preempts states from regulating Commodity Futures Trading Commission-registered sports bets.
“These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them,” Ms. Davenport said in a statement. “States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.”
She wants to know whether Congress, by enacting Dodd-Frank, intended to federalize a multi-billion-dollar sports-wagering industry.
Kalshi sued New Jersey in 2025 to block the state from enforcing its local gambling laws against the prediction market, arguing that because it is registered with the CFTC as a designated market, federal law gives the federal government exclusive jurisdiction over its platform, overriding state gambling rules.
Now, New Jersey is asking the Supreme Court to review the Third Circuit’s ruling that favored Kalshi and blocked the state from enforcing its local gambling laws on the prediction market.
In response, a Kalshi spokesperson said the platform is “an open, nationwide financial exchange” that “cannot be regulated by 50 different regulators.”
The appeal follows an opposing ruling from the Ninth Circuit in a Nevada case on Friday, which found that states have the power to regulate prediction markets as sports betting.
New Jersey argues that prediction contracts are indistinguishable from traditional sports betting and should not be immune from state laws. Kalshi and the CFTC have said federal financial regulations override state rules.
After the Ninth Circuit ruling, a CFTC spokesman said the split called for “resolution by the Supreme Court.”
Litigation over these questions has erupted across multiple states, with dozens of suits pending and the gambling laws of several states currently enjoined by the federal courts.
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