Novig and New Mexico Seek Yearlong Pause in Federal Lawsuit

Jonathan Rodriguez

Written by: Jonathan Rodriguez

Published: Thu Aug 27, 2026, 8:00 am ET

Read Time: 4 minutes

Novig and New Mexico Seek Yearlong Pause in Federal Lawsuit

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Novig and New Mexico officials have proposed pausing their federal legal battle until August 2027. Both parties filed a joint proposed motion with the court on August 25.

The proposal would pause proceedings while a separate CFTC case against New Mexico moves forward. Importantly, the New Mexico court has not yet granted the requested stay.

The development follows a stay that Massachusetts has already granted in Novig's separate lawsuit. Together, the cases highlight the growing legal fight over sports prediction markets and state gambling authority.

Novig and New Mexico Propose Yearlong Stay

Novig and New Mexico jointly asked the federal court to stay the case until August 13, 2027. Their proposal centers on a separate lawsuit filed by the Commodity Futures Trading Commission (CFTC).

The CFTC sued New Mexico over the state's treatment of federally regulated prediction markets. The federal agency argues that federal commodities law limits state interference with these markets.

Novig's lawsuit raises a similar federal preemption question. The company argues that the Commodity Exchange Act gives the CFTC authority over its sports event contracts.

Therefore, both sides believe the CFTC litigation could provide important guidance. A stay could also prevent the courts from addressing overlapping legal questions simultaneously.

Under the proposed agreement, New Mexico officials would not pursue enforcement against Novig during the proposed stay. The protection would cover civil and criminal actions involving Novig's sports event contracts.

The proposed restrictions would also continue for at least 14 days after the stay ends. Meanwhile, Novig plans to dismiss several Gaming Control Board defendants without prejudice.

The parties would provide the court with an update by July 30, 2027. At that point, they could request that proceedings resume or remain paused.

For now, though, the New Mexico stay remains only a joint proposal awaiting court approval.

Latest Development Between Novig and Massachusetts

The situation differs in Massachusetts because the court has already granted Novig's requested stay. U.S. District Judge F. Dennis Saylor IV approved the joint request on August 25.

The Massachusetts case will remain paused while the state's Supreme Judicial Court considers a related Kalshi appeal. That appeal involves a preliminary injunction concerning Kalshi's sports event contracts.

Novig and Massachusetts officials agreed that the appeal could affect questions raised in Novig's case. Consequently, they supported pausing the proceedings to avoid duplicative litigation.

Massachusetts officials also agreed not to pursue civil or criminal enforcement against Novig during the stay. The agreement covers the company's sports-related event contracts.

The Massachusetts development therefore provides Novig with temporary legal breathing room. The proposed New Mexico stay could provide similar protection if the court approves it.

Novig's Sports-Only Model Adds a Key Defense

Novig's business model also differs from broader prediction-market platforms. Unlike competitors such as Kalshi and Polymarket, Novig strictly offers sports event contracts.

The company also enforces a 21+ age requirement for its platform. That distinction matters as Novig challenges state claims involving gambling and underage activity.

Novig maintains that its products operate under federal commodities regulation. States, meanwhile, can argue that sports event contracts effectively constitute sports wagering.

That distinction could prove important for New Mexico gambling regulators. It could also influence how courts approach similar disputes involving Massachusetts gambling authorities.

Novig Expands Its Federal Legal Strategy

The New Mexico dispute forms part of Novig's broader preemptive federal strategy. The company has challenged regulators across five states.

Those states include New York, Massachusetts, New Mexico, Washington, and Wisconsin. Novig filed the Wisconsin lawsuit shortly after its cases against the other four states.

The strategy seeks to preserve Novig's ability to operate while higher courts consider federal preemption. Each case could also contribute to a broader legal framework for sports prediction markets.

For US online sportsbooks, the outcome could create another important regulatory dividing line. Courts may ultimately determine whether prediction markets fall under federal commodities law or state gambling rules.

The Bottom Line

Novig and New Mexico have proposed, but not yet secured, a stay in their legal dispute. The requested pause could last until August 13, 2027.

Meanwhile, Massachusetts has already granted Novig's stay while a related Kalshi appeal proceeds.

Novig's five-state legal campaign reflects a broader effort to secure operational time. The company wants courts to resolve federal preemption questions before states enforce gambling restrictions.

Because Novig focuses exclusively on sports contracts, its cases could also establish important boundaries. Those rulings may shape the future relationship between prediction markets and state gambling laws.

Jonathan Rodriguez
Jonathan Rodriguez

Jonathan is an avid basketball fan, and is often looking forward to the next upcoming NBA season when not checking players' stats during games. He also likes to keep his ears on the ground for the latest rumblings in the online casino industry.

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