A Nevada state court issued a temporary restraining order against Polymarket last week in the latest twist involving prediction markets.
The company was sued by the Nevada Gaming Control Board (NGCB) on Jan. 15. The ruling has effectively forced Polymarket to exit the market.
The NGCB argued that “Polymarket’s event contracts are wagers.”
‘Reasonably Likely To Prevail’
In his ruling, Judge Jason D. Woodbury noted that the NGCB was “reasonably likely to prevail on the merits of the underlying case.”
He further added: “The record at this early stage in proceedings indicates Polymarket offers ‘event-based contracts’ that relate to sporting and other events, including college basketball games, college, and professional football games and elections.”
Those offerings put the company at odds with state gaming laws, and Polymarket lacks a license to offer sports betting in Nevada, the ruling said. Woodbury said firms like Polymarket that operate without a sports wagering license evade and harm the state’s regulatory gaming structure.
Additionally, Woodbury noted that an unlicensed operator beyond the NGCB’s control “obstructs the board’s ability to fulfill its statutory functions.” The temporary restraining order will initially last only 14 days; a hearing on a motion for a permanent injunction is scheduled for Dec. 11.
Continuing Court Battles
Prediction market firms claim their offerings are different from traditional sports betting and solely regulated at the federal level by the Commodity Futures Trading Commission. Several state regulators have disputed that assertion.
Earlier this month, a state judge in Massachusetts ordered prediction market firm Kalshi to immediately cease offering sports prediction markets in the state. In December, Nevada regulators also ordered Kalshi to stop operating in the state.
This followed a lawsuit against the company in South Carolina. In August, Kalshi also lost a suit in federal court in Maryland. That ruling was delayed as an appeal was expected.
