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Arizona’s criminal case against Kalshi was halted by a federal judge after the Trump administration stepped in

A judge on Friday ordered Arizona’s attorney general to temporarily pause its criminal case against Kalshi, handing a win to the Trump administration in its effort to stop states from regulating prediction markets.

Federal Judge Michael Liburdi’s decision to back the US Commodity Futures Trading Commission in the case came at the end of a hectic week of arguments in which a lawyer for the federal regulator said a state criminal case would be a “flawed” way to settle hotly contested questions about whether prediction markets can list sports, politics, and other controversial markets.

State prosecutors filed 20 charges of illegal betting and election betting against Kalshi last month. The charges, all misdemeanors, characterize Kalshi’s contracts as the kind of bets that are either prohibited under Arizona law or require a state gambling license. The criminal case also had the effect of halting a federal challenge that Kalshi had filed to Arizona’s regulatory power.

Then the CFTC stepped in, suing Arizona and two other states earlier this month. The state on Friday argued that Congress never meant to let swaps that bear many similarities to sports bets take place on federally regulated exchanges. Liburdi issued an order that will prevent Arizona from moving forward with a criminal arraignment of Kalshi that had been scheduled for Monday.

“I will enter a temporary restraining order,” the judge said, granting the CFTC’s request to halt the state’s prosecution. He didn’t immediately state what the specific provisions of the order would be, but lawyers for the attorney general agreed to show up to criminal court first thing Monday and ask for their case against Kalshi to be paused.

Robert J. DeNault, a senior lawyer at Kalshi, hailed the decision on X, calling it “a step in the right direction.”

The CFTC’s leader, Michael Selig, has posted videos and made the rounds of podcasts in recent weeks to defend his agency’s authority to regulate prediction markets. The Trump administration has generally applied a light regulatory touch on the industry.

“Arizona’s decision to weaponize state criminal law against companies that comply with federal law sets a dangerous precedent, and the court’s order today sends a clear message that intimidation is not an acceptable tactic to circumvent federal law,” Selig said in a statement after the ruling.

Prediction markets like PredictIt, Kalshi, and Polymarket have existed for years, but they experienced a surge in usage around the 2024 election.

Since Donald Trump returned to office, Trump’s son, Donald Trump Jr., has become a paid advisor to Kalshi, and an investment firm he works for invested in Polymarket. Kalshi also began hosting sports-related markets, which it had not done during the Biden administration.

Federal law prohibits commodities markets related to things like war, assassination, and “gaming,” but the specific meanings of those terms have been debated in court.

Many states, but especially those where the traditional gambling industry holds sway, like Nevada and New Jersey, have argued that the contracts on prediction markets relating to sports, and sometimes politics, are illegal. Some members of Congress have also proposed new laws to regulate prediction markets.




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After weeks of getting bashed, two software giants can make the case for why AI won’t kill them

After being marked for dead, software companies have a chance to tell their side of the story.

Excluding Canada’s Olympic hockey teams, no one has had a tougher go recently than software companies. Everyone faces some fear over AI, but software’s diagnosis has been more dire than most. (Author Nassim Taleb was the latest to write software’s eulogy, although he’s not known for his optimism.)

Two software giants — Salesforce and Snowflake — get to make the case for why they’re still very much alive. Both companies report earnings after the bell and will be interested in changing a narrative that’s helped push their stocks down 27% (Salesforce) and 26% (Snowflake) this year.

(Workday, another software company that’s been getting hammered, made the case yesterday why AI is friend, not foe.)

A major problem for software companies is that their opponent is largely hypothetical. Even if both companies report blockbuster earnings, there’s still the counterargument that AI will eventually eat their lunch.

Anthropic has played this game masterfully. The startup has strategically rolled out product announcements for its AI chatbot, Claude. The news has devastated entire industries despite there being no evidence of widespread adoption yet.

Here’s what to look out for from Salesforce and Snowflake when they report:

Salesforce: Marc Benioff’s company is the prototypical enterprise software company. Customer relationship management systems are all about workflow and rely heavily on seat-based subscriptions. That makes Salesforce a prime target for AI automation and a bellwether for other software companies.

Benioff has sought to address competitors head-on with Salesforce’s own AI agents and even contemplated a name change to acknowledge the shift. But Agentforce has had its share of challenges. An internal survey showed that most employees feel AI is increasing their productivity, but Salesforce will want the same positivity coming from outside its walls.

These days, AI might not even be Salesforce’s biggest headache. An off-color joke from Benioff at a recent employee event has outraged many workers and even prompted fellow Salesforce executives to speak out.

Snowflake: The data-warehousing giant might seem like a major beneficiary of AI. Models need tons of data to function. Snowflake helps companies organize and analyze massive amounts of data. Everybody wins!

The potential future isn’t as rosy. Snowflake’s business might not face the direct risk that other software companies struggle with, but it could slide down the totem pole of customers’ tool set. Instead of being considered a crucial software, it could become just another piece of back-end infrastructure.

Snowflake’s own CEO warned of this future, saying models’ desire to have easy access to all types of data means “everything else, the world, is just a dumb data pipe that feeds into that big brain.”

And unfortunately for Snowflake, the value you provide to customers as a “dumb data pipe” is a lot lower, meaning you can’t charge as much.




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Wall Street employees

Elite investment bank settles case that put Wall Street’s 100-hour weeks on trial


Momo Takahashi, Business Insider

  • A junior banking analyst sued her former firm over its unpredictable, grueling work hours.
  • A settlement in the case was reached just before the case was set to go to trial.
  • The terms of the settlement were not disclosed.

Centerview Partners and former junior banker Kathryn Shiber have reached a settlement, ending a closely watched lawsuit about Wall Street work culture that was set to go to trial in Manhattan federal court.

The case centered on allegations that the boutique investment bank violated disability discrimination laws when it fired Shiber in 2020 after she said she needed eight to nine hours of sleep each night because of an underlying mood and anxiety disorder.

Court filings and depositions in the case offered a rare look into the grueling demands placed on first-year analysts, including testimony that they typically work between 60 and 120 hours a week and that “in some projects, you are working 24 hours a day.”

Centerview has denied wrongdoing.

“Centerview has said all along that Ms. Shiber’s legal claims have no merit,” a Centerview spokesperson told Business Insider in a statement. “We were ready to prove that in court, and are confident we would have prevailed at trial. But we are nonetheless happy to put this distraction behind us and focus on delivering for our clients.”

The resolution means a jury will not weigh in on questions about Wall Street’s long hours and workplace accommodations.

Terms of the settlement were not disclosed. Lawyers for Shiber did not respond to requests for comment from Business Insider.




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FBI ups reward in Nancy Guthrie case to $100,000 and shares new details about a suspect

  • The FBI released new details on a suspect in Nancy Guthrie’s disappearance.
  • The suspect was described as a male of average build, seen carrying an Ozark Trail Hiker Pack.
  • The FBI also doubled the reward for information on the case.

The FBI has upped its reward in the disappearance of Nancy Guthrie and shared new details on a suspect.

The agency is offering $100,000, up from $50,000, for information that leads to Guthrie’s location or to the arrest and conviction of anyone involved in her disappearance, the FBI said Thursday.

Guthrie, the 84-year-old mother of “Today” show host Savannah Guthrie, has been missing since February 1. Authorities have said Guthrie, who has limited mobility and takes a daily medication for a heart condition, was abducted from her home near Tucson, Arizona.

The FBI said Thursday that identifying details about the suspect had been confirmed, describing him as a man of average build, about 5 feet and 9 to 10 inches tall. He was seen in doorbell camera footage wearing a black backpack identified as a 25-liter Ozark Trail Hiker Pack.

On Tuesday, the FBI and the Pima County Sheriff’s Department released images from Guthrie’s Nest doorbell camera showing a person at her door wearing a full ski mask. Authorities said the person was “armed.”

This is a breaking news story. Check back for updates.




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Kelsey Baker, Military and Defense Reporting Fellow

Legal experts: Veterans’ rights at stake in Kelly speech case

A new lawsuit from a Democratic senator and combat veteran at the heart of a free speech fight seeks to block the Pentagon’s intensifying crackdown.

Arizona Sen. Mark Kelly sued Defense Secretary Pete Hegseth on Monday, warning that the Pentagon’s effort to punish him “sends a chilling message” to veterans who speak out against the Trump administration.

Hegseth accused Kelly of “seditious” acts after Kelly publicly reminded US service members that they are not required to follow illegal orders. The Pentagon’s actions against Kelly have troubling implications for the political speech of millions of veterans, military law experts said.

Hegseth’s effort to muzzle a US senator “places other retirees who have spoken up potentially in jeopardy,” said Rachel VanLandingham, a professor at Southwestern Law School who is a retired Air Force JAG. “Not knowing whether or not he’s going to come after you already has a chilling effect.”

Kelly said his lawsuit is about fighting back. The Democratic lawmaker announced the federal lawsuit on Monday. His suit also named the Department of Defense, Navy Secretary John Phelan, and the Navy Department as defendants. Kelly’s video urging troops not to follow illegal orders.

Veterans who serve 20 years or more are eligible for a military pension, but those benefits can be revoked or reduced if retirees are found to have violated military law while in uniform. By contrast, Hegseth’s move seeks to punish a veteran for his speech long after serving in uniform, an approach one expert on military law called baseless.

Kelly’s lawsuit argues that using the military justice system to punish veterans’ political speech risks setting a precedent that abuses the First Amendment rights of other retired troops.


Secretary of Defense Pete Hegseth standing in front of a Department of War sign

Defense Secretary Pete Hegseth’s prosecution of Kelly has implications for veterans’ speech, legal analysts said.

DoW photo by U.S. Air Force Staff Sgt. Madelyn Keech



Legal basis in question

The lawsuit argues that nothing in the law allows the Pentagon to revisit a retirement determination based on a veteran’s speech. Such a move, the filing says, would raise “serious constitutional concerns” and leave retired service members facing a constant threat to their earned benefits.

There’s no legal basis for Hegseth’s pursuit, VanLandingham said. The defense secretary initially sought to court-martial Kelly, threatening him with the military equivalent of a criminal trial. It later opted for a lesser administrative punishment.

“The process is the punishment,” said Frank Rosenblatt, a retired Army JAG and professor at Mississippi College School of Law. “The claim against Kelly had no merit.”

“Senator Kelly’s speech is not punishable under the UCMJ,” the National Institute of Military Justice nonprofit group said in a December statement in reference to the Uniform Code of Military Justice.

The lawsuit seeks to halt actions that could reduce Kelly’s military rank and retirement pay and characterizes that effort as “unlawful.”

After filing the lawsuit, Kelly requested a temporary restraining order and a preliminary injunction from the federal court, seeking to halt the Pentagon’s actions while the case is reviewed on its merits. Both are emergency measures that ask a judge to stop government action before permanent harm occurs.

The federal government has been increasingly pushing cases important to the Trump administration onto a “rocket docket,” Rosenblatt said, accelerating litigation toward higher courts. If the judge assigned to the case, US District Judge Richard Leon, issues a ruling the government doesn’t like, “this could move very quickly to the DC Circuit and potentially the Supreme Court.”

Leon has previously ruled against the military’s authority over retirees.

“I am not concluding today that Congress could never authorize the court-martial of some military retirees,” Leon wrote in a 2019 memorandum opinion that rejected the government’s argument that military jurisdiction over all retirees was necessary to maintain good order and discipline of its active force. The judge noted he had not seen a clear argument for “why the exercise of such jurisdiction over all military retirees is necessary.”

In a post on X last week, Hegseth called Kelly’s video with five other Democratic lawmakers “reckless and seditious” and said it was “clearly intended to undermine good order and military discipline.”

The military justice provisions that Hegseth accused Kelly of violating — Articles 133 and 134 of the Uniform Code of Military Justice — are not explicitly tied to sedition and can cover a wide range of alleged misconduct.

Kelly’s lawsuit argues that allowing the executive branch to punish a member of Congress for speech is a threat to the Constitution and erodes congressional oversight of the armed services.

“We are aware of the litigation,” a Pentagon spokesperson said Tuesday when asked for comment on the lawsuit. “However, as a matter of policy, the Department does not comment on ongoing litigation.” That same day, Hegseth took aim at Kelly’s military rank in an X post: “‘Captain’ Kelly knows exactly what he did, and that he will be held to account.”




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‘This case is going to trial’: Judge rejects Sam Altman’s efforts to toss Elon Musk’s OpenAI lawsuit

It looks like Sam Altman and Elon Musk are headed for a courtroom showdown.

During a hearing on Wednesday, a California judge said she plans to reject Altman’s lawyers’ last-ditch efforts to end Musk’s case against OpenAI and its CEO.

“This case is going to trial,” US District Judge Yvonne Gonzalez Rogers said at a hearing to consider whether the evidence was sufficient to warrant a jury trial.

“I think there’s plenty of evidence,” she said, referring to Musk’s case. “It’s circumstantial, but that’s how these things work.”

In his lawsuit filed in 2024, Musk accused OpenAI of misleading him in its decision to abandon its original nonprofit mission and structure in favor of a profit-oriented model, including through its partnership with Microsoft.

Musk says he donated $38 million to the maker of ChatGPT over the years to support its mission to develop AI for the benefit of humankind. The Tesla CEO is seeking monetary damages, as well as a judgment to void Microsoft’s licensing agreement with OpenAI.

At a hearing on Wednesday, an Oakland federal court judge said she felt there was enough evidence that Musk may have been deceived to allow the case to move forward to a jury. A trial is scheduled for March.

“There were assurances made, and promises made, that the structure would be maintained,” she said. “There was lots of information that was not shared.”

The judge added that she also felt “there are strong arguments by the defense.”

“I think the jury is going to get to decide,” she said.

OpenAI lawyers have denied Musk’s allegations, saying Musk was aware of the company’s for-profit plans as early as 2018. OpenAI has also pointed out that it is still controlled by OpenAI’s nonprofit arm.

“Mr Musk’s lawsuit continues to be baseless and a part of his ongoing pattern of harassment, and we look forward to demonstrating this at trial,” a spokesperson for OpenAI told Business Insider. “We remain focused on empowering the OpenAI Foundation, which is already one of the best resourced nonprofits ever.”

A spokesperson for Musk did not immediately respond to a request for comment.

Musk has filed multiple lawsuits against OpenAI. Most recently, his AI company, xAI, sued OpenAI in September, accusing it of stealing trade secrets and targeting its employees for recruitment. At the time, an OpenAI spokesperson told Business that the lawsuit is “the latest chapter in Mr. Musk’s ongoing harassment.”

Musk helped found OpenAI in 2015, but left the company in 2018. At the time he said his work with OpenAI could present a conflict of interest with Tesla’s AI ambitions.

Since, Musk has repeatedly criticized Altman and OpenAI, including the company’s structure. Musk later went on to launch his own AI company, xAI, in 2023.




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