Ninth Circuit rules tribes likely to win challenge against Kalshi sports contracts

The U.S. Court of Appeals for the Ninth Circuit has reversed a lower court ruling, finding that two California tribes are likely to succeed in their legal challenge against Kalshi, Inc. and Robinhood. The tribes, Blue Lake Rancheria and Chicken Rancheria of Me-Wuk Indians, argue that Kalshi’s sports-event contracts violate the Indian Gaming Regulatory Act (IGRA) when accessed from tribal lands.

The court determined that these contracts likely constitute unauthorized Class III gaming because they require customers to risk money on the uncertain outcomes of sporting events. While the Ninth Circuit did not issue an immediate injunction to stop the contracts, it remanded the case to the U.S. District Court to evaluate other factors for a preliminary injunction, such as irreparable harm and the public interest.

The Indian Gaming Association (IGA) described the decision as a victory for tribal sovereignty, asserting that federally regulated commodities exchanges cannot bypass federal Indian gaming laws through creative terminology or technology.