Kalshi seeks to pause Washington injunction after rival OG deal

KalshiEX LLC has asked a King County Superior Court judge to reconsider an amended preliminary injunction that is forcing it to restrict its Washington operations, after state regulators agreed to hold off on enforcing similar limits against a rival exchange.

As reported last week, Judge John F. McHale had already ordered Kalshi to cut back most of its Washington markets after finding the company likely violated state gambling law. The order bars contracts tied to sports, elections, politics, entertainment, culture, technology, science and “mentions,” and requires Kalshi to put in place an IP address and residency-based geofence and then a multi-source blocking system.

The latest motion centers on an Aug. 18 agreement involving North American Derivatives Exchange Inc., which does business as OG. Kalshi says OG is a Commodity Futures Trading Commission-licensed designated contract market that offers event contracts to consumers in Washington.

According to the motion, the Washington Attorney General and the state Gambling Commission agreed not to pursue civil or criminal enforcement actions against OG over event contracts traded on a designated contract market until the 9th U.S. Circuit Court of Appeals resolves pending appeals. Kalshi says that agreement is new evidence undermining the state’s claim that its own continued operation causes immediate and substantial harm to Washington consumers.

The company argues that it is already blocking Washington traders while OG can continue serving those same consumers under the non-enforcement deal. It says the disparity could push customers toward competitors and damage its goodwill and market access.

Kalshi asked McHale to vacate portions of the injunction or, alternatively, stay its operative provisions on terms similar to those given to OG while the appeals continue. It said it is not seeking relief from the requirement to preserve records.

The hearing on the motion is scheduled for Sept. 2 without oral argument.