Novig Seeks CEA Preemption in New York Suit as It Rolls Out Nationwide CFTC-Regulated Platform

Novig has filed a federal lawsuit against New York authorities seeking a declaration that the state’s gambling laws are preempted by the Commodity Exchange Act. The action comes one day after the company launched its CFTC-regulated sports trading platform nationwide. It aims to head off enforcement similar to the state’s recent suit against Kalshi seeking $36 billion in damages.

Novig argues that absent this relief it faces “irreparable harm in multiple ways,” including potential state enforcement. As reported by Casino Beats, the company describes itself as the leading sports prediction market “designed by sports traders for sports traders.”

Platform Features and Strategic Partnerships

Jacob Fortinsky, co-founder and CEO of Novig, said: “For too long, sports fans have had limited ways to engage with the markets they know best. They are among the most passionate and informed communities in the world, yet they’ve never had a platform truly built around how they think, engage, and trade.” The platform restricts access to users over 21, citing its commitment to responsible scaling. This contrasts with Kalshi, now facing a New York subpoena on sports-event contracts involving persons under 21.

As Daniel Wallach (@WALLACHLEGAL) noted on X: “New York issues document subpoenas to Kalshi seeking details of transactions involving sports-event contracts and persons “under the age of 21.” Subpoenas do not seek details of any other category of event contracts, just sports. First government subpoena directed at Kalshi.”

Novig previously operated as a sports betting operator in Colorado before pivoting to prediction markets. It closed a $75 million funding round in February while pursuing its CFTC license. The company also signed on as the first official prediction market partner of the New York Mets, with branding at Citi Field. Jordan Bender of Citizens Equity Research challenged Novig’s win-probability claims, citing median ROI of -8% for prediction market users versus -5% for sportsbooks.

Where the Legal Risk Lies

The federal preemption argument places the dispute in a more favorable forum after states have prevailed in their own courts. For client-partners in this sector the suit signals how operators may use the CEA to counter aggressive state actions. Outcomes here could clarify boundaries at this regulatory inflection point, particularly where age controls and market surveillance differentiate compliant platforms from those facing subpoenas and billion-dollar claims.

Reporting: Casino Beats