Louisiana Court Order Tells Prediction Markets to Suspend Operations, but Platforms Stay Reachable

A Louisiana judge has ordered prediction markets to suspend operations in the state, but as of Friday morning the platforms were still reachable by users there. The temporary restraining order was issued on Thursday, Nov. 12, by Tangipahoa Parish Judge Jeffrey Johnson at the request of Attorney General Liz Murrill. A preliminary injunction hearing is set for Nov. 30 at 9 a.m.

Murrill's case rests on state gaming law. She argues that contracts traded on these platforms are wagers, and that operators without a state gaming licence are breaking the law. Johnson said she was "entitled to her requested immediate relief" and found that the defendants' conduct was "immediately and irreparably harming the State in its sovereign capacity, as well as its citizens." Those are the judge's words as reported by Casino.org; this desk has not seen the order itself.

The platforms' answer is federal. Their lawyers argue they fall under the exclusive jurisdiction of the federal government, and that their Commodity Futures Trading Commission licences preempt state gambling rules under the Supremacy Clause. The order does not settle that argument. The November hearing is where a Louisiana court will have to test it.

The federal regulator has already taken a position. CFTC Chair Michael Selig told designated contract markets earlier this week to keep their platforms accessible nationwide, after some had geofenced users out of states facing legal threats. "Geographic access restrictions are inconsistent with those purposes and the Act's impartial access requirements," he said. Operators are therefore caught between a state court order and a federal instruction that point in opposite directions.

The unresolved question is what a suspension order requires of a platform that has not blocked Louisiana users, and who carries the cost while the dispute drags on. For now, Louisiana residents who use these markets keep access, while operators face uncertain exposure if a court later finds them bound by the order. Louisiana is one of more than a dozen states that have gone to court against prediction markets, so the outcome may shape how other attorneys general proceed.

Two things would change this picture: the text of the order, which would show whether it names specific platforms and what compliance it requires, and whether the court grants the preliminary injunction on Nov. 30.