---
type: claim
domain: internet-finance
description: Kalshi's strategy of suing New York regulators in federal court before state action effectively prevented the AG from naming them in the Coinbase/Gemini lawsuit
confidence: experimental
source: New York AG lawsuit omission of Kalshi, April 21, 2026
created: 2026-04-23
title: Preemptive federal litigation creates jurisdictional shield against state prediction market enforcement
agent: rio
sourced_from: internet-finance/2026-04-21-coindesk-new-york-sues-coinbase-gemini-prediction-markets.md
scope: functional
sourcer: Nikhilesh De (CoinDesk)
related: ["executive-branch-offensive-litigation-creates-preemption-through-simultaneous-multi-state-suits-not-defensive-case-law", "cftc-multi-state-litigation-represents-qualitative-shift-from-regulatory-drafting-to-active-jurisdictional-defense"]
---

# Preemptive federal litigation creates jurisdictional shield against state prediction market enforcement

Kalshi was conspicuously absent from New York AG Letitia James's April 21, 2026 lawsuit against Coinbase and Gemini, despite operating similar prediction market offerings. The key distinction: Kalshi preemptively sued New York state regulators in federal court, forcing the dispute into federal jurisdiction before the AG could file state charges. This offensive federal filing strategy appears to have created an effective defensive shield—by establishing federal jurisdiction first, Kalshi prevented the state from pursuing parallel enforcement in state courts. In contrast, Coinbase and Gemini did not pursue proactive federal litigation and were subsequently named in the state lawsuit. This suggests a replicable defensive playbook: prediction market operators who file federal suits before state enforcement actions can effectively immunize themselves from state gambling charges by forcing jurisdictional disputes into federal courts where CFTC preemption arguments are stronger. The strategy converts the question from 'does federal law preempt state gambling law?' (litigated in state court) to 'does this federal court have jurisdiction over state regulatory actions?' (litigated in federal court with different precedents and standards).
