Ninth Circuit Rejects Kalshi Rehearing Bid, Leaving Nevada Free to Enforce Gambling Laws on Prediction Contrac
The Ninth Circuit denied Kalshi's rehearing requests, allowing Nevada to enforce gambling laws against its sports event contracts.Summary
The U.S. Court of Appeals for the Ninth Circuit denied Kalshi's petitions for panel rehearing and rehearing en banc, leaving in place its August 28 ruling that dissolved a preliminary injunction that had shielded the prediction market operator from Nevada gaming enforcement. The court found that Kalshi's sports event contracts do not qualify as swaps under the Commodity Exchange Act (CEA) and that the CEA likely does not bar Nevada from applying its gaming laws, exposing Kalshi to civil and criminal liability despite its federal registration. Kalshi has until February 2, 2027, to petition the Supreme Court for a writ of certiorari, and may coordinate with pending New Jersey litigation before the Third Circuit, which ruled in Kalshi's favor and faces its own Supreme Court review request. Conflicting appellate outcomes have sharpened the dispute over whether federal derivatives rules preempt state and tribal gambling laws, and a CFTC rulemaking on event contract jurisdiction could influence the timing of any Supreme Court filing. A Supreme Court petition would not guarantee acceptance or halt state enforcement in the interim, and the August precedent binds federal courts across the Ninth Circuit but does not impose an automatic nationwide ban.
(Source：Sccg Management)