These arguments are unconvincing. First, a company may suffer irreparable harm even if only some of its business is affected. And, at bottom, Tennessee’s argument is that Kalshi need only obtain a license in Tennessee to accept bets in this state, and therefore its harms are self- inflicted. But it is unclear how Kalshi could operate a nationwide exchange subject to Tennessee’s restrictions. And, as Kalshi has shown, complying with the Letter’s demands would be difficult and costly. Moreover, Kalshi has shown a likelihood of reputational harm among Tennessee users, notwithstanding the opinions of some courts that have sided against it. D. Balance of interests The third and fourth factors in the preliminary injunction analysis—substantial harm to others and the impact of the injunction on the public interest—merge because the defendant is the state. Churchill Downs , 162 F.4th at 643 (citing Kentucky v. Biden , 57 F.4th 545, 556 (6th Cir. 2023)). And “enjoining the enforcement of a law that violates constitutional rights ‘is always in the public interest.’” Id. (quoting Dahl v. Bd. of Trs. of W. Mich. Univ. , 15 F.4th 728, 736 (6th Cir. 2021) (per curiam)). Kalshi faces substantial expenses and reputational harm if it complies with Tennessee’s demands, or civil and criminal enforcement if it does not. Tennessee, meanwhile, is likely to face no harm because the court finds its enforcement in this case is likely preempted. And, if the defendants succeed on the merits, the court can then pursue enforcement against Kalshi. As another court has noted, a finding for Kalshi on a motion for preliminary judgment “does not prejudge a finding for defendants through dispositive motion practice or trial.” Kalshi D.N.J. , 2025 WL 1218313, at *7 (citation omitted). 20 20 The court acknowledges the defendants’ argument that the SWC has a statutory duty to protect consumers, and in particular “vulnerable consumers.” (Doc. No. 34 at 42.) Furthermore, the court appreciates the defendants’ position that “[s]ports gaming is highly addictive, particularly among young men, so protecting consumers aged 18 to 20 from exposure to sports gaming is an
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Case 3:26-cv-00034 Document 48 Filed 02/19/26 Page 23 of 25 PageID #: 891
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