Kalshi Wins Partial Stay in Nevada While Ninth Circuit Appeal Looms
A federal judge in Nevada partially paused Kalshi's ongoing case with state regulators. Chief Judge Andrew P. Gordon did so on January 14 to allow the Ninth Circuit to consider the prediction market platform's appeal of a November ruling that dissolved a preliminary injunction.
However, the judge also refused to pause discovery. As a result, both sides must continue litigating the case at the district court level while the appeal proceeds. The court paused deadlines for dispositive motions and the proposed joint pretrial order. It will reinstate deadlines once Kalshi’s appeal reaches a final resolution.
Judge Gordon highlighted that the Ninth Circuit’s decision will likely provide guidance on the legal issue, but may not resolve the case on the merits. If any circumstances change, either party may request permission to file an early motion for summary judgment.
By allowing discovery to continue, the court signaled that the case is likely to return to the district court regardless of the appellate outcome. Continuing discovery means both sides will need to exchange documents, provide evidence, and take depositions, even as the Ninth Circuit reviews whether the preliminary injunction should have remained in place.
A Back and Forth Case in Nevada
Kalshi has clashed with the Nevada Gaming Control Board (NGCB) since the regulator ordered it to stop offering prediction markets in the state in March 2025. It claimed that the product functioned like sports betting, which requires a state license.
Kalshi responded by filing a federal lawsuit in Nevada. It sought an injunction to block state enforcement, arguing that its platform fell within the CFTC’s jurisdiction.
Kalshi secured an initial win in April when the court issued a preliminary injunction. However, Gordon reversed the decision and dissolved this injunction in November. He stated that Kalshi is actually subject to the state’s gaming laws.
Kalshi appealed this decision to the Ninth Circuit, arguing that the lower court erred in lifting the injunction. It then asked the district court to stay the entire case pending appeal — a request Judge Gordon only partially granted.
The Nevada lawsuit is one of several legal challenges Kalshi is facing as state regulators across the U.S. debate whether prediction markets fall within existing sports betting and gambling frameworks.
NGCB Chairman Mike Dreitzker said the NGCB would vigorously oppose attempts to pause Judge Gordon’s decision pending appeal.
Tennessee Is the Latest Battleground
The outcome of Nevada’s case could have significant ramifications for Kalshi’s U.S. operations. It’s already embroiled in legal action with many other states.
The most recent lawsuit involves the Tennessee Sports Wagering Council. The regulator sent cease-and-desist letters on January 9 to Kalshi, Polymarket, and Crypto.com. It demanded that they halt their operations in the state for not having a license to offer sports betting. Kalshi refuted these claims and filed a federal lawsuit to stop this “unlawful attempt.”
U.S. District Judge Aleta Trauger in Nashville issued a temporary restraining order on January 12. It effectively stopped Tennessee from enforcing its sports betting laws against Kalshi. The court will hold a hearing on January 26 to see if the judge will grant an extended preliminary injunction.
With discovery continuing in Nevada and emergency relief granted in Tennessee, Kalshi is now litigating its regulatory status on multiple fronts. The outcomes of these litigations could shape how prediction markets are treated across the U.S.
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