Wisconsin Judge Denies CFTC Injunction Request

Jonathan Rodriguez

Written by: Jonathan Rodriguez

Published: Thu Jul 30, 2026, 11:00 am ET

Read Time: 4 minutes

Wisconsin Judge Denies CFTC Injunction Request

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A federal judge in Wisconsin handed the Commodity Futures Trading Commission (CFTC) a significant setback this week. The ruling allows the state to continue enforcing its gambling laws against sports prediction markets while litigation proceeds.

US District Judge William C. Griesbach denied the CFTC's request for a preliminary injunction. The agency had sought to prevent Wisconsin Attorney General Josh Kaul from taking action against federally regulated prediction market operators offering sports-related event contracts.

The decision marks the first major courtroom loss for the CFTC in its nationwide campaign to defend prediction markets. It also strengthens Wisconsin's position as states continue challenging sports event contracts they believe resemble traditional sports betting.

The case could influence future disputes involving US online sportsbooks, prediction markets, and state regulators. At the center of the conflict is whether federal commodities law overrides state gambling statutes when exchanges list sports-related event contracts.

Judge Griesbach Found the CFTC Failed to Meet the Standard for Emergency Relief

Judge Griesbach concluded that the CFTC did not satisfy the requirements for a preliminary injunction. While the litigation will continue, he found the agency failed to justify blocking Wisconsin from enforcing its gambling laws during the case.

The judge explained that a preliminary injunction requires a strong showing that the plaintiff will likely succeed on the merits. The moving party also must demonstrate irreparable harm without immediate relief.

CFTC Failed to Show Likelihood of Success or Irreparable Harm

The court found the CFTC fell short on both requirements.

According to the ruling, the agency did not establish that it would likely prevail on its claim that the Commodity Exchange Act preempts Wisconsin gambling laws. Judge Griesbach also found the CFTC failed to show that allowing Wisconsin to enforce its statutes would cause irreparable harm while the lawsuit remains pending.

The court noted that prediction market operators could challenge any enforcement actions through the normal judicial process. As a result, the judge determined that emergency intervention was unnecessary.

CFTC Argued Federal Law Preempts Wisconsin Gambling Laws

The CFTC maintained that Congress granted it exclusive authority to regulate federally approved event contracts. Therefore, the agency argued Wisconsin could not apply its gambling laws to sports-related contracts traded on designated exchanges.

Judge Griesbach rejected the need for immediate relief and questioned the agency's position. He also emphasized that the court had not yet determined whether Wisconsin's gambling statutes actually cover the disputed contracts.

He wrote:

"Of course, if Wisconsin's gambling statutes do not cover sports-related event contracts, then the CFTC's case against the State makes no sense. There is no reason to enjoin the State from enforcing a statute that does not apply."

The judge added that resolving whether Wisconsin law applies remains a central issue for later stages of the litigation.

Prediction Market Legal Battles Continue Across the United States

The Wisconsin decision adds another chapter to the growing conflict between state regulators and prediction market operators.

The CFTC has filed lawsuits against several states after attorneys general and gaming regulators challenged sports event contracts offered by exchanges such as Kalshi. States argue these products function like sports betting and should fall under state gambling laws.

Meanwhile, the CFTC maintains that federally regulated event contracts fall exclusively under the Commodity Exchange Act.

Court rulings have produced mixed results.

Earlier this week, a federal judge blocked Minnesota from enforcing its first-in-the-nation law banning sports prediction markets while litigation continues. That ruling favored the CFTC's preemption argument at the preliminary stage.

Elsewhere, courts have reached different conclusions. Washington secured a preliminary injunction allowing its enforcement action against Kalshi to move forward. However, Crypto.com filed a lawsuit against Washington for this.

These conflicting outcomes highlight the unsettled legal landscape surrounding prediction markets and Wisconsin gambling laws.

The Dispute Could Shift to the Federal Appeals Courts

The Wisconsin ruling does not resolve the broader legal question. Instead, it leaves the parties to continue litigating whether federal commodities law overrides state gambling regulations.

More states have challenged sports prediction markets during the past several months. As a result, multiple federal courts are now considering similar questions under different factual circumstances.

Legal observers expect appeals to follow as inconsistent rulings continue to emerge. Those decisions could eventually reach the federal appellate courts and potentially the US Supreme Court.

Until then, Wisconsin may continue enforcing its gambling laws while the case proceeds. The outcome could shape how prediction markets, state regulators, and US online sportsbooks coexist in the evolving US gaming industry.

Jonathan Rodriguez
Jonathan Rodriguez

Jonathan is an avid basketball fan, and is often looking forward to the next upcoming NBA season when not checking players' stats during games. He also likes to keep his ears on the ground for the latest rumblings in the online casino industry.

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