# Judge Says CFTC Order Letting Kalshi Operate Gave Appearance of Collusion

By Riza Dagoc

Canonical URL: https://www.tokenpost.com/news/regulation/55393
Published: 2026-11-12T12:43:08.000Z
Updated: 2026-11-12T12:43:08.000Z
Section: Regulation

> The judge denied Novig’s bid to block New York from applying gambling laws to its sports contracts, finding they likely were not swaps under federal law.

A federal judge said a CFTC order directing Kalshi to keep operating after New York sued gave the appearance of collusion between a regulator and the company, sharpening a dispute over sports contracts.

U.S. District Judge Colleen McMahon on Nov. 10 denied Novig’s request for a preliminary injunction against New York, finding its sports event contracts were likely not swaps under the Commodity Exchange Act. That finding leaves New York able to apply its gambling laws to Novig’s contracts.

Novig filed a notice of appeal with the Second Circuit several hours after the ruling.

McMahon also criticized the CFTC’s rules for treating sports and other event contracts as swaps while excluding sports betting and casino wagers from that category. She called the positions internally inconsistent.

The decision involved Novig’s challenge to New York, while the criticized CFTC order concerned Kalshi’s separate effort to keep operating in the state. The disputes put federal derivatives oversight and state gambling authority at the center of a fight over sports event contracts.