Key Points
- California tribes failed in their attempt to merge their Kalshi/Robinhood appeal with a Nevada prediction market lawsuit at the Ninth Circuit
- Blue Lake Rancheria and two other California tribes filed suit against Kalshi and Robinhood early in 2025, claiming unauthorized sports wagering on tribal territories
- A district court judge previously sided with Kalshi, determining that federal commodity regulations control event-based contracts
- Kalshi has requested an emergency stay of Washington state proceedings during its appeal of a remand order back to state court
- The company argues simultaneous state and federal litigation threatens to produce conflicting rulings and jurisdictional confusion
Prediction market litigation on the West Coast diverged into separate proceedings last week following a Ninth Circuit ruling that denied tribal consolidation efforts, while Kalshi simultaneously pursued a stay in Washington state court.
Blue Lake Rancheria, Chicken Ranch Rancheria of Me-Wuk Indians, and Picayune Rancheria of the Chukchansi Indians petitioned the Ninth Circuit to assign their pending appeal to the identical judicial panel currently reviewing a Nevada prediction market dispute.
The tribal nations contended both matters involve intersecting legal issues regarding the regulatory framework for event-based contracts under federal commodity law. Consolidation would promote efficiency and prevent inconsistent interpretations, they maintained.
The appellate court disagreed. Its May 6 order noted substantial distinctions between the tribal litigation and the North American Derivatives Exchange case connected to Crypto.com.
Citing these material differences, the panel denied reassignment. The tribal appeal will continue independently on its own calendar.
Tribal Nations Challenged Operations as Unauthorized Gaming
The three California tribes initiated their lawsuit against Kalshi and Robinhood in July 2025. Their complaint alleged both platforms operated unlawful sports betting services that extended into tribal jurisdictions.
Central to their legal theory was the Indian Gaming Regulatory Act. The tribal plaintiffs contended the defendants undermined tribal self-governance and violated federal protections for tribal gaming operations.
By November 2025, a federal district judge dismissed the tribal claims. The court determined that the Commodity Exchange Act, not tribal or state gaming laws, provides the governing legal framework for event contracts.
Additionally, the judge concluded that the Unlawful Internet Gambling Enforcement Act applies to Kalshi’s digital platform rather than the Indian Gaming Regulatory Act. That ruling now forms the basis of the current appeal.
The tribes attempted to bolster their appellate position by connecting their matter to the ongoing Nevada litigation. The Ninth Circuit rejected that approach.
Kalshi Requests Emergency Stay in Washington State Matter
Meanwhile, Kalshi filed a motion seeking to halt all proceedings in Washington state’s lawsuit during its federal appeal.
Washington state regulators sued Kalshi concerning its prediction market platform. Kalshi removed the litigation to federal court, asserting the Commodity Futures Trading Commission holds exclusive regulatory authority over event contracts.
On May 5, U.S. District Judge John C. Coughenour rejected that argument. His ruling found the dispute inappropriate for federal jurisdiction because gambling oversight remains a state function. He remanded the case to state court.
Kalshi immediately appealed and now seeks a procedural freeze. The company maintains that allowing state proceedings to advance during federal appellate review risks incompatible judicial determinations.
In its filing, Kalshi employed emphatic terminology. The company warned that concurrent proceedings threaten “judicial chaos” and would create a “rat’s nest of comity and federalism issues.”
Kalshi referenced recent favorable decisions in other jurisdictions to strengthen its argument. The company highlighted a preliminary injunction granted to the CFTC in Arizona and its appellate victory against New Jersey in the Third Circuit.
The platform requests either a full stay pending appeal or, alternatively, a temporary stay while it pursues emergency relief from the Ninth Circuit.
As of May 11, Judge Coughenour has not yet ruled on the stay request in the Washington federal court.
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