TLDR
- The Ninth Circuit rejected California tribes’ request to combine their Kalshi/Robinhood appeal with a related Nevada prediction market case
- Three California tribes sued Kalshi and Robinhood in 2025, alleging illegal sports betting on tribal lands
- A federal judge had previously ruled in favor of Kalshi, saying federal commodity law governs event contracts
- Kalshi is trying to pause Washington state’s lawsuit while it appeals a federal judge’s decision to send the case back to state court
- Kalshi warned that letting state and federal cases run at the same time could create “judicial chaos”
West Coast prediction market battles took two separate paths last week. The Ninth Circuit rejected a tribal request to combine appeals, and Kalshi moved to freeze a Washington state lawsuit.
Three California tribes had asked the Ninth Circuit to assign their appeal to the same panel hearing a related Nevada prediction market case. The tribes are Blue Lake Rancheria, Chicken Ranch Rancheria of Me-Wuk Indians, and Picayune Rancheria of the Chukchansi Indians.
They argued the cases share overlapping legal questions about how event-based contracts are regulated under the Commodity Exchange Act. Combining them, the tribes said, would save time and court resources.
But the Ninth Circuit said no. In a brief order on May 6, the court pointed to major differences between the tribal appeal and the North American Derivatives Exchange lawsuit tied to Crypto.com.
The court wrote that reassigning the appeal was denied due to those differences. The tribes will now proceed on their own track.
Tribes Alleged Illegal Sports Betting on Tribal Lands
The tribes first sued Kalshi and Robinhood in July 2025. They claimed the two companies were running illegal sports betting operations that reached tribal lands.
Their case centered on the Indian Gaming Regulatory Act. The tribes argued the companies were threatening tribal sovereignty and violating federal law protecting tribal gaming rights.
In November 2025, a federal judge ruled against the tribes. The judge found that the Commodity Exchange Act governs event contracts, not tribal or state law.
The judge also ruled that the Unlawful Internet Gambling Enforcement Act applies to Kalshi’s online operations rather than the Indian Gaming Regulatory Act. That decision is now on appeal.
The tribes had tried to strengthen their position by linking their case to the Nevada proceedings. That strategy did not work.
Kalshi Pushes to Freeze Washington Lawsuit
In a separate fight, Kalshi filed a motion to pause Washington state’s lawsuit against it. The company wants a stay while it appeals a federal judge’s ruling.
Washington had sued Kalshi over its prediction market operations. Kalshi removed the case to federal court, arguing the Commodity Futures Trading Commission has exclusive jurisdiction over event contracts.
On May 5, U.S. District Judge John C. Coughenour disagreed. He ruled the case does not belong in federal court because gambling regulation falls under state oversight. He sent the case back to state court.
Kalshi appealed and is now asking the court to hit pause. It warned that letting state court proceedings move forward while federal appeals are pending could lead to conflicting decisions.
The company used strong language in its filing. It said parallel proceedings risk creating “judicial chaos” and a “rat’s nest of comity and federalism issues.”
Kalshi pointed to recent wins in other courts to support its position. It cited favorable rulings in Arizona, where a judge granted a CFTC preliminary injunction, and in the Third Circuit, where it won against New Jersey.
The company is asking for a stay pending appeal or, at minimum, an interim stay while it seeks relief from the Ninth Circuit.
As of May 11, the Washington stay request remains pending before the federal court.
