Massachusetts Judge Considering 30 Days for Kalshi to Geofence Sports Markets
Massachusetts judge gives preview of the guidelines he’s likely to include in an injunction blocking Kalshi’s sports markets in the state.
Massachusetts Superior Court Justice Christopher Barry-Smith has issued his guidance to both parties in the latest chapter of the commonwealth’s lawsuit to bar Kalshi from offering contracts on sporting events in the Bay State.
Barry-Smith issued a two-page letter earlier this week outlining his preliminary views following his 20-page ruling on Jan. 20, where he granted Massachusetts’ request for a preliminary injunction. Kalshi filed for a stay a week ago, asking the judge to hold off on enforcing the injunction while the prediction market operator appeals the ruling.
The state filed the lawsuit in September, arguing that Kalshi’s sports contracts violates the state’s sports betting law. The Massachusetts Gaming Commission (MGC) issues all sports wagering and iGaming licenses in the state.
In the letter, he provided preliminary details on the implementation of last week’s injunction, ahead of the parties submitting a proposed formal order by Wednesday, Feb. 4.
What Barry-Smith is Thinking
Barry-Smith has indicated that he will not force any Massachusetts resident who purchased and still owns contracts on a sports market to liquidate their position. However, under the injunction, those traders would not be able to buy additional contracts.
They could sell shares if they wish.
In contrast, selling an existing position… is one of the options that a Massachusetts buyer had at the time of purchase, and to interfere with that option goes beyond the prospective order that I view as appropriate,” the judge wrote.
Kalshi, though, may not get the time it wanted to implement a geofencing solution if the stay is denied. Barry-Smith noted he would likely give the company 30 days, rather than the requested 90, to work with a technology provider that would bar anyone physically located in Massachusetts from buying contracts on sports markets.
The judge has encouraged the state and Kalshi to work together on the framework for an injunction. If the parties cannot come to an agreement, they may present their ideas to him by next Wednesday. Barry-Smith would either issue the injunction next Wednesday or schedule a hearing to make a decision.
“I anticipate deciding Kalshi’s emergency request for a stay pending appeal on the same timeline,” he concluded.
Several States Pursuing Kalshi
Massachusetts is not alone in seeking to block Kalshi or other prediction market operators from offering contracts on sporting events, and since Barry-Smith ruled in the state’s favor last week, several states have used that ruling in their arguments seeking similar orders.
Several of the cases will have arguments scheduled in February.
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