Quick Summary
- On August 14, Novig initiated federal litigation targeting Wisconsin’s Attorney General and gaming regulator
- The platform contends its sports-based contracts qualify as federally supervised derivatives under Commodity Exchange Act provisions
- Back in April, Wisconsin initiated legal action against Kalshi, Polymarket, Robinhood, Crypto.com, and Coinbase for comparable contract offerings
- In July, a federal court rejected the CFTC’s request for a preliminary injunction preventing Wisconsin’s enforcement actions
- Since August 4, Novig has initiated lawsuits in five different states
Sports prediction marketplace Novig has initiated federal litigation targeting Wisconsin state authorities, attempting to prevent the application of state gambling regulations to sports event contracts available on its platform.
The 45-page legal filing was submitted on August 14 to the U.S. District Court for the Western District of Wisconsin. The company is pursuing both preliminary and permanent injunctive relief, alongside a declaratory judgment establishing federal law supremacy over state regulations.
On June 16, the Commodity Futures Trading Commission designated Novig’s operational arm, Ludlow Exchange LLC, as a contract market. Approximately one week prior to filing suit, the platform commenced offering event contracts to Wisconsin residents.
The Company’s Legal Strategy
According to Novig, its sports-oriented contracts constitute federally regulated derivatives falling under Commodity Exchange Act provisions. The platform maintains this classification places them squarely within the CFTC’s sole regulatory authority, superseding state-level gambling statutes.
This represents Novig’s stated legal theory and awaits judicial determination by the Wisconsin court. Seeking accelerated proceedings, the company characterizes potential state enforcement action as presenting what it calls “imminent and existential” business threats.
Novig distinguishes its operations from competing prediction market platforms. The company exclusively provides sports-focused contracts, eschewing event contracts linked to political events or international developments. Additionally, the platform enforces a minimum age requirement of 21 for all users.
Challenging Legal Environment
Novig confronts a challenging legal landscape in Wisconsin. State authorities filed suit against Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase during April, contending their sports event contract offerings violated Wisconsin’s commercial gambling prohibition and constituted public nuisance.
Subsequently, the CFTC filed its own lawsuit against Wisconsin, requesting federal court intervention to halt state enforcement activities. On July 28, Judge William Griesbach rejected that petition. His determination found the CFTC had failed to demonstrate probable success regarding its preemption argument. The decision did not constitute final adjudication.
The fundamental conflict between federal and state regulatory authority governing prediction markets continues without nationwide resolution.
Beginning August 4, Wisconsin represents the fifth jurisdiction where Novig has filed suit. The platform has simultaneously pursued litigation against government officials in New York, Massachusetts, Washington, and New Mexico as part of its nationwide expansion strategy.
Meanwhile, Novig’s commercial operations continue expanding. The company revealed a multiyear collaboration with the New York Mets on July 30, establishing itself as the franchise’s exclusive official prediction market partner. This arrangement encompasses Citi Field venue advertising, broadcast rights, and access to official MLB data feeds.
According to the latest publicly accessible court records, Wisconsin officials have yet to submit a substantive response, and the court has not issued a determination regarding the injunction petition.
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