Arizona Judge Denies Kalshi’s Motion For Preliminary Injunction

• Kalshi suffered a legal blow in Arizona as a U.S. District Court judge denied two of the company’s motions
• The judge denied Kalshi’s motion for a temporary restraining order and preliminary injunction against the state
• Court cites the Anti-Injunction Act, which applies and bars preliminary injunctive relief

Kalshi’s motion for a temporary restraining order and preliminary injunction against the state of Arizona has been denied by a U.S. District Court judge.

U.S. District Court for the District of Arizona Judge Michael T. Liburdi denied the prediction market company’s motion for a preliminary injunction and temporary restraining order against Arizona, citing the court is barred by the Anti-Injunction Act (AIA) from issuing an injunction.

“The Court finds that the AIA applies and the preliminary injunction Kalshi requests does not fall within any exception to the application of the AIA. The Court is barred by statute from issuing the injunction, so it must deny Kalshi’s requests for preliminary relief,” Judge Liburdi wrote in his decision.

Kalshi Denied AIA Exception For Preliminary Relief

Last month, Kalshi filed a complaint for permanent injunction and declaratory relief in U.S. District Court for the District of Arizona against Kristin K. Mayes, Attorney General of Arizona, and several high ranking officials with the Arizona Department of Gaming, including its director Jackie Johnson.

According to counsel for Kalshi, previous actions from the Arizona Department of Gaming and the Attorney General, including a cease-and-desist letter sent to the company in May 2025, led to the decision to take preemptive legal action.

However, the motion for a preliminary injunction and a temporary restraining order was denied. The court disagreed with Kalshi’s request it be given an exception to the AIA.

“But the exception to the AIA applies only ‘to injunctions issued at the request of the United States,’ Wencke, 622 F.2d at 1368, and the question before this Court is whether to grant Kalshi’s request for a preliminary injunction. Although the basis for granting Kalshi preliminary injunctive relief would be largely identical to the basis for granting a permanent injunction, the federal government has not yet requested the preliminary relief that this Court is assessing. So the Court will not apply the exception here,” Judge Liburdi wrote.

Kalshi Says Department Believes Offerings Are Illegal Gaming

Kalshi filed its preemptive lawsuit against Arizona on March 12.

Counsel for Kalshi pointed to a May 21, 2025, cease-and-desist letter sent to the prediction market company by the Arizona Department of Gaming as a clear sign the department would be taking legal action if they did not conclude their business in the state.

“The letter directed Kalshi to ‘cease gambling operations in Arizona and desist from engaging in those activities in the future’ and threatened Kalshi with criminal penalties if it did not comply. Defendants have additionally made numerous statements indicating they believe Kalshi is operating unlawfully under Arizona’s anti-gambling laws by offering event contracts. The agencies also threatened to revoke the license of any entity that partners with Kalshi anywhere in the United States,” counsel wrote.

According to Kalshi, the company attempted to contact the Arizona Attorney General to obtain written assurances of non-enforcement, but was met with silence from the office “even though the Arizona Attorney General had previously been willing to communicate with counsel and had previously assured Kalshi that defendants would not pursue an enforcement action without providing prior notice.”

An Arizona Department of Gaming spokesperson told Sports Betting Dime the “agency is aware of the lawsuit against the Department of Gaming, filed by Kalshi” but cannot comment further.