New York federal judge denies Novig’s preliminary injunction request, allowing state gambling law to apply to its sports event contracts
According to The Block, U.S. District Judge Colleen McMahon of the Southern District of New York denied sports prediction market platform Novig’s request for a preliminary injunction on November 10. Novig sought to stop New York State from applying its gambling and sports betting laws to its business.
The court ruled that Novig’s sports event contracts do not qualify as “swaps” under the Commodity Exchange Act, so federal commodities law does not preempt state law. New York State may require it to obtain a state gambling license or prohibit the related contracts from being listed for trading.
In the opinion, the judge noted that there was no need to ignore common sense — Novig’s sports event contracts are sports betting — and cited the company’s public statements saying that its goal is to become the world’s largest sports betting platform. Ludlow Exchange LLC, the company operating Novig, filed a lawsuit against the New York attorney general and others in August this year.
Gambling lawyer Daniel Wallach said state regulators may shift from defending enforcement authority in federal court to actively exercising that authority in state court.
Original source:
Title: THE BLOCK: A New York federal judge has denied sports prediction market platform Novig's preliminary injunction bid... Publisher: The Block Publication date: 2026-11-11 URL: https://x.com/TheBlockCo/status/2120452499627028575 Source type: news report Verification status: Based on reading multiple English reports and a summary of the court opinion; consistent with the judge’s ruling and the facts of the case Supporting content: Supports the core facts that the injunction was denied, the contracts were ruled not to be swaps, and state law may apply
ABAB AI Insight
This ruling continues the stance of New York and the Second Circuit toward sports prediction markets, leaning toward treating them as within the scope of state gambling regulation. Novig was previously designated by the CFTC as a contract market, but the court held that this was not enough to exclude state law.
Denying the preliminary injunction does not determine the case’s final outcome, but it reduces the possibility of a federal court immediately blocking state enforcement. The state side may move more proactively in state court.
Whether sports event contracts qualify as federally regulated “swaps” remains the core dispute, and this opinion strengthens the argument that they are substantively gambling.
ABAB News · Cognitive Law
The court found that Novig’s sports event contracts are not swaps under the CEA.
New York State gambling law may apply to its activities.
After the preliminary injunction was denied, the path for state enforcement is clearer.