Second Circuit denies Kalshi and Coinbase injunctions against New York and Connecticut gambling law

A federal appeals court on November 3, 2026, refused to shield Kalshi and Coinbase from New York and Connecticut gambling law while the companies appeal rulings that went against them.

A panel of the US Court of Appeals for the Second Circuit, made up of Judges John M. Walker Jr., Dennis Jacobs and Joseph F. Bianco, denied the companies' motions for an injunction pending appeal in three cases it is considering in tandem. The order was issued the same day the panel heard argument on the motions in Manhattan.

"Upon due consideration, it is hereby ORDERED that the motions are DENIED because Appellants have failed to make the required showing that an injunction pending appeal is warranted," the order says, citing the court's 2020 decision in Agudath Israel of America v. Cuomo. The order, signed by Clerk of Court Catherine O'Hagan Wolfe, does not explain the panel's reasoning further.

The three appeals

The motions came in KalshiEX LLC v. Williams (No. 26-1835), Kalshi's appeal against officials of the New York State Gaming Commission; KalshiEX LLC v. Cafferelli (No. 26-2239), against the Commissioner of the Connecticut Department of Consumer Protection and others; and Coinbase Financial Markets, Inc. v. Tong (No. 26-2297), against Connecticut Attorney General William Tong and others.

In each case, the companies argue that federal commodities law gives the Commodity Futures Trading Commission exclusive authority over their sports event contracts and pre-empts state gambling law. Judge Analisa Torres of the Southern District of New York denied Kalshi a preliminary injunction on July 7, 2026, according to New York's appellate brief. In Connecticut, Judge Vernon D. Oliver ruled against the companies on August 10, 2026.

In its October 30 brief to the Second Circuit, New York called Kalshi "a multibillion-dollar gambling business that it calls a 'prediction market'" and asked the court to affirm the New York ruling.

What the order does and does not decide

The November 3 ruling concerns only whether the companies should be protected while the appeals proceed. The panel has not yet decided the appeals themselves.

Separately, the New York Attorney General is suing Kalshi over alleged violations of state and federal gambling laws in a case now before the federal court in Manhattan (No. 1:26-cv-06550), and the New York State Gaming Commission is seeking to enforce its subpoenas against Kalshi in state court. AskSpinner tracks these and other cases in its Kalshi and prediction market litigation tracker.

Kalshi and Coinbase had not publicly responded to the order as of November 4 (Beijing time).

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