New Jersey is preparing to petition the U.S. Supreme Court to address a critical question worth billions: Are the contracts for sports events provided by prediction platforms considered sports betting, or are they regulated financial derivatives under federal law?
On Friday, Jeremy Feigenbaum, the solicitor general of New Jersey, submitted a request for an extension to file a petition known as a writ of certiorari with the nation’s highest court. This petition will urge the justices to review a ruling from a federal appeals court that barred the state from applying its sports betting regulations to Kalshi.
Feigenbaum pointed out that an extension is crucial because upcoming decisions from both the Fourth and Ninth Circuits, along with the Massachusetts Supreme Judicial Court, regarding the same legal matter could clarify whether there is a discrepancy among appellate courts, thus reinforcing the necessity for Supreme Court intervention.
New Jersey Faces Setback
On April 6, the Third Circuit federal appeals court determined that the U.S. Commodity Futures Trading Commission (CFTC) holds exclusive jurisdiction over Kalshi, which prevents state regulators from hindering the prediction platform’s contracts associated with sports events.
This ruling dealt a significant blow to New Jersey’s attempts to enforce its sports betting laws against Kalshi and similar prediction market operators, which the state contends are engaging in illegal and unlicensed sports betting activities.
Kalshi initiated legal action against New Jersey in late March 2025 after the state issued cease-and-desist orders from the Division of Gaming Enforcement (DGE).
The platform argued that the state’s enforcement threats encroach upon the exclusive authority of the CFTC, claiming that state regulations are preempted when they conflict with federal statutes.
In late April, a district court issued a preliminary injunction in favor of Kalshi, stopping the state from enforcing its sports betting regulations against the platform while the case unfolds.
The Third Circuit upheld this injunction in a 2-1 verdict, concurring that Kalshi had a strong likelihood of succeeding on its preemption claim.
Single Dissenting Opinion
U.S. Circuit Judge Jane Richards Roth stood as the sole dissenter on the appellate panel, asserting that event contracts were “hardly distinguishable from the betting products available on online sportsbooks, like DraftKings and FanDuel.”
In his application to the Supreme Court, Feigenbaum stressed that the Third Circuit’s ruling could have extensive implications across the nation.
“This matter is of great significance: The Third Circuit majority’s determination—that sports bets fall under the exclusive jurisdiction of the Commodity Exchange Act and that the Act overrules state regulations of these bets—would effectively federalize a multibillion-dollar-a-year sports wagering sector, undermining state laws across the country,” he stated.