Case 1:25-cv-14723 Document 10-1 Filed 08/19/25 Page 17 of 34 PageID: 89
citing N.J. Const. art. IV, § 7, ¶ 2(D). Id. The Division demanded that Kalshi “immediately
cease and desist from offering any form of sports wagering to New Jersey residents and void any
such wagers already placed.” Id. The Division reserved “the right to pursue any appropriate
sanctions” if Kalshi failed to comply with the cease-and-desist letter. Id. at 2.
Robinhood received a nearly identical cease-and-desist letter from the Division on
March 27, 2025. Mackenzie Decl. ¶ 7. The Division’s letter to Robinhood asserted the same
violations of the New Jersey Sports Wagering Act and the New Jersey Constitution as the Kalshi
letter; it also made the same demand that Robinhood “immediately cease and desist from
offering any form of sports wagering to New Jersey residents and void any such wagers already
placed” and reserved the Division’s right to pursue sanctions should Robinhood not comply. Id.
¶ 8. The Division further stated that failure to comply with the cease-and-desist letter by 11:59
pm on March 28, 2025 “will result in the Division taking further enforcement actions, which
may include any measures available under New Jersey law.” Id. Violations of the New Jersey
Sports Wagering Act are punishable as “crime[s] of the fourth degree” or by fines of up to
$100,000. N.J.S.A. §§ 5:12A-11(c), 2C:43-2.
Upon receiving its cease-and-desist letter, Kalshi, arguing that New Jersey law is
preempted by the CEA, sought declaratory and injunctive relief from this Court. KalshiEx ,
No. 25-cv-2152, ECF No. 1. The Court granted Kalshi’s motion for a temporary restraining
order and preliminary injunction, holding that Kalshi demonstrated a likelihood of success on the
merits, that it will likely suffer irreparable harm without relief, and that the balance of interests
favors injunction. KalshiEx , 2025 WL 1218313, at *3-8. The Division has appealed that
decision. KalshiEx LLC v. Flaherty , No. 25-1922 (3d Cir. 2025).
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