The Ninth Circuit has denied Kalshi’s request to pause Nevada enforcement while its appeal continues, reportedly. The decision allows the state case brought by the Nevada Gaming Control Board to proceed; the board has asked a Carson City court to block Kalshi for 14 days.
The ruling leaves Kalshi exposed to Nevada enforcement while its appeal is pending.
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The Ninth Circuit Court of Appeals ruled that sports event contracts at issue in Nevada fall under gambling rules rather than federal swaps law. The court rejected injunction requests from Kalshi, Crypto.com and Robinhood. DraftKings shares gained up to 10%, while Flutter shares rose up to 8%.
A federal appeals court has determined that the sports-related event contracts under scrutiny in Nevada count as gambling products, not swaps regulated by federal commodities law, per a report. Under that outcome, the Nevada Gaming Control Board may keep enforcing state gaming law against such offerings within the state. Kalshi, Crypto.com and Robinhood had asked for injunctive relief to block Nevada regulators from shutting down their sports-related event contract offers in the state, and the court turned those requests down.
The Ninth US Circuit Court of Appeals ruled that Nevada can require a gaming licence for Kalshi sports-event contracts, finding Kalshi unlikely to show that federal law pre-empts the state requirement. Kalshi said it would seek further review and maintained that federal rules permit sports contracts; Nevada regulators are also pursuing contempt proceedings and a previously ordered daily penalty.
A three-judge panel of the US Court of Appeals for the Ninth Circuit heard arguments on 16 April in four cases involving Nevada and sports event contracts offered through designated contract markets. The cases include Kalshi, Robinhood Derivatives and North American Derivatives Exchange; an earlier Third Circuit ruling upheld a preliminary injunction blocking New Jersey from prohibiting Kalshi’s contracts.
The US Court of Appeals for the Ninth Circuit ruled unanimously for the Blue Lake Rancheria Indians and the Chicken Ranch Rancheria of the Me-Wuk Indians in their dispute with Kalshi and Robinhood. The court found the tribes had valid grounds to argue that Kalshi’s sports-event contracts could violate their rights under federal law; it sent the case back to the lower court and did not order Kalshi to stop offering contracts in California.
A Suffolk County Superior Court judge denied Kalshi’s request for an emergency stay in Massachusetts on Friday, according to the report. The order requires Kalshi to block state customers from sports event contracts after a 30-day implementation period ending 9 March; non-sports markets are unaffected. Kalshi may seek a stay from an appellate court judge.