Prediction market platform Kalshi has engaged former U.S. Acting Solicitor General Neal Katyal in its ongoing legal dispute in Washington State. This development follows a King County Superior Court judge’s preliminary injunction against Kalshi, which the company is currently appealing.
What Happened
On July 20, King County Superior Court Judge John McHale issued a preliminary injunction against Kalshi, siding with Washington Attorney General Nick Brown. The judge rejected Kalshi’s defense that oversight by the U.S. Commodity Futures Trading Commission (CFTC) preempts state gambling law, according to GeekWire. Following this ruling, Kalshi appealed the decision to the Washington Court of Appeals and requested Judge McHale to pause his injunction pending the appeal, as per court records cited by GeekWire.
Despite the injunction, Kalshi reportedly remains operational in Washington State nearly three weeks after the initial ruling, as Judge McHale has yet to rule on Kalshi’s stay motion or establish the operational terms of the injunction, according to GeekWire.
Key Details
- King County Superior Court Judge John McHale granted a preliminary injunction against Kalshi on July 20, 2026, finding that Kalshi’s online gambling likely violates state law, according to The Seattle Times and Washington State Attorney General’s Office.
- Kalshi has appealed the injunction to the Washington Court of Appeals and filed a motion to stay the injunction, according to GeekWire.
- Former U.S. Acting Solicitor General Neal Katyal is now representing Kalshi in the Washington state case, as indicated by court records referenced by GeekWire. Katyal previously served as Kalshi’s lead national counsel in similar state-level cases.
- Kalshi is still operating in Washington State, reportedly because Judge McHale has not yet ruled on the stay motion or defined the operational terms of the injunction, according to GeekWire.
- Kalshi cited a July 27 Minnesota federal court order that blocked that state from enforcing a similar prediction-market ban. Washington countered with an August 5 Utah federal ruling against Kalshi and an August 7 Michigan federal ruling against Coinbase Financial Markets, according to GeekWire.
Why It Matters
Washington state is serving as a key jurisdiction in the national discussion concerning whether federal commodities oversight can supersede state gambling laws, as stated by GeekWire. The involvement of a legal professional with significant appellate experience, such as a former U.S. Acting Solicitor General, suggests Kalshi is preparing for a substantial legal challenge regarding federal preemption rules, according to GeekWire. The resolution of this case could establish precedents for the operation of prediction markets in regulated environments, impacting both operators and regulators.
What’s Next
Judge McHale’s forthcoming ruling, expected in the coming days, is anticipated to determine whether Kalshi will be required to cease operations in Washington state while its appeal proceeds, according to GeekWire.
Originally reported by GeekWirePublished
Sources & References
Primary source
- GeekWiregeekwire.com
Additional references
- WA judge halts Kalshi ‘prediction market’ over state gambling laws | The Seattle Timesseattletimes.com
- Judge finds Kalshi’s online gambling likely violates state law | Washington Stateatg.wa.gov
- Judge blocks Kalshi in WA, ruling the platform likely ran ‘illegal gambling operation’kuow.org
- Kalshi Fights ‘Extraordinary’ Bid To Halt Wash. Operations – Law360law360.com