Kalshi has been barred from offering sports-event contracts on the lands of two California tribes after a federal judge granted a preliminary injunction in a dispute over whether the platform’s contracts violate tribal gaming laws.
Summary
- A federal judge has barred Kalshi sports-event contracts on specified California tribal lands through preliminary relief.
- Blue Lake Rancheria and Chicken Ranch Rancheria must submit boundary maps to Kalshi by November 13.
- Kalshi must report its compliance steps within 21 days of the November 4 court order.
- The Ninth Circuit previously found the tribes likely to succeed under the Indian Gaming Regulatory Act.
- Arkansas and Utah have pursued separate gambling-related cases against Kalshi, which disputes their regulatory positions.
In a November 4 court order, U.S. District Judge Jacqueline Scott Corley ruled in favor of Blue Lake Rancheria and the Chicken Ranch Rancheria of Me-Wuk Indians. The injunction applies to sports contracts offered on the tribes’ Indian lands, including those covering football, basketball, baseball, soccer, tennis and Ultimate Fighting Championship events.
The ruling requires the tribes to provide Kalshi with maps showing the boundaries of their lands by November 13. Kalshi must submit a report detailing its compliance measures within 21 days of the November 4 order.
Kalshi faces restrictions on sports contracts on tribal lands
The injunction prevents Kalshi Inc. and KalshiEX from offering sports contracts on the designated tribal lands while the underlying lawsuit continues.
The restriction covers contracts involving golf, hockey, boxing, wrestling, motorsports, pickleball, chess and esports, alongside other sporting events. It does not prohibit Kalshi from operating throughout California or establish a nationwide ban.
The tribes initially challenged Kalshi’s sports contracts in July 2025, arguing that the platform was facilitating unauthorized Class III gaming under the Indian Gaming Regulatory Act (IGRA).
Their complaint alleges that Kalshi violated tribal gaming ordinances by allowing users on tribal lands to trade contracts based on sporting outcomes without the required authorization.
Kalshi has maintained that its event contracts qualify as federally regulated financial derivatives under the Commodity Exchange Act (CEA). The company argues that the Commodity Futures Trading Commission’s authority over derivatives markets takes precedence over conflicting gaming restrictions.
The November order specifically names Kalshi Inc. and KalshiEX. Although Robinhood is a defendant in the underlying lawsuit, the preliminary injunction does not expressly impose the same restrictions on the Robinhood entities.
Appeals court previously ruled in favor of California tribes
The latest decision follows a September ruling by the Ninth U.S. Circuit Court of Appeals that reversed part of Corley’s earlier decision.
In November 2025, the district judge had denied the tribes’ request for a preliminary injunction. The tribes appealed, challenging the court’s interpretation of federal derivatives laws and tribal gaming protections.
A three-judge appellate panel reversed that decision in part on September 16, finding that the tribes were likely to succeed on their claims under IGRA.
The judges determined that Kalshi’s sports contracts constituted Class III gaming when customers entered them from tribal lands. They concluded that the CEA did not prevent the tribes from pursuing their claims under federal Indian gaming law.
However, the appellate court upheld the rejection of a separate false-advertising claim under the Lanham Act.
The case returned to the district court for consideration of the remaining requirements for preliminary relief.
Sports and gaming attorney Daniel Wallach described the ruling as the first preliminary injunction obtained by tribes against Kalshi nationwide, calling it “a major development in tribal gaming litigation.”
Arkansas and Utah pursue separate legal actions against Kalshi
Kalshi faces separate legal proceedings concerning its sports-event contracts in other states.
On November 4, Arkansas Attorney General Tim Griffin filed a lawsuit accusing the company of operating an illegal gambling platform in the state.
As crypto.news previously reported, Arkansas sued Kalshi over allegations that its sports, election and entertainment contracts violated state gambling restrictions.
The complaint seeks to prevent the alleged activity and recover revenue that authorities claim the platform obtained unlawfully.
Utah has pursued criminal proceedings against Kalshi and company executives Tarek Mansour and Luana Lopes Lara. Prosecutors filed 14 charges on October 28, alleging violations involving the promotion of illegal gambling.
A separate Utah civil lawsuit seeks as much as $61.2 million in allegedly unlawful trading fees.
According to Wallach, Kalshi argued in a recent Utah court filing that its event contracts qualify for an exception covering lawful business transactions under state law.
The attorney highlighted the company’s argument that contracts traded on a CFTC-designated market fall within that exception because federal law regulates the transactions.
Federal regulators have taken a different position from Utah authorities. The CFTC and the U.S. government sued Utah in October to challenge its enforcement against federally regulated prediction markets.
The federal complaint seeks to prevent state authorities from applying certain gambling restrictions to event contracts traded through CFTC-registered exchanges.
