TLDR A Ninth Circuit panel sided with two California Tribes in their case against Kalshi and Robinhood The court said Kalshi’s sports event contracts work like Class III gaming under federal Indian gaming law The case was sent back to a lower court to weigh a possible injunction A House committee advanced a bill to restore the full tax deduction for gambling losses New York reported $1.3 billion in mobile sports betting tax revenue for the fiscal year
A federal appeals court ruled against Kalshi this week in a case brought by two California Tribes. The Ninth Circuit panel found the Tribes are likely to win their argument that Kalshi’s sports contracts count as a form of regulated gaming.
The ruling marks Kalshi’s second loss before a Ninth Circuit panel in under three weeks. A separate panel ruled against the company in a related Nevada case earlier this month.
What the Court Decided
The panel rejected Kalshi’s argument that its sports event contracts are different from traditional sports bets. The judges wrote that the substance of the contracts is sports gambling, regardless of what the company calls them.
The court also turned down Kalshi’s claim that federal commodities law should override tribal gaming law. Judges said the two laws cover different issues and can exist side by side.
The panel described it as unlikely that Congress meant to undo decades of sports gambling rules built by federal, state and tribal governments. The case now returns to a lower court, which will decide whether to issue an injunction.
Gaming attorney Daniel Wallach said Kalshi has now lost before every judge across both Ninth Circuit appeals. He said the ruling could affect other pending tribal challenges to sports event contracts around the country.
Tax and Revenue Developments
Away from