The unanimous ruling follows a lawsuit filed by Blue Lake Rancheria and Chicken Ranch Rancheria, who argue that Kalshi has been offering unauthorized gambling to people on their reservations, stepping on gaming activity that falls under tribal law. The decision overturns an earlier ruling from a San Francisco district judge, who had dismissed the case after deciding that prediction markets didn’t count as gambling.
Writing for the panel, Judge M. Margaret McKeown said that regardless of the label used, a customer risking money on an uncertain sports outcome and getting paid if it happens works the same as a bet placed through a licensed sportsbook. The court also pointed to Kalshi’s own marketing, which promoted its platform as a way to bet on sports nationwide, going against the company’s argument that its contracts are fundamentally different from bets.
The court stated:
“The tribes are likely to succeed in their claims that Kalshi’s sports event contracts on tribal lands violated IGRA and the tribes’ gaming ordinances. IGRA thus confers upon the tribe a cause of action to enjoin Kalshi’s sports-event contracts on their lands. In practice, what Kalshi labels ‘sports-event contracts’ nearly track the activities described in IGRA and its implementing regulations. The similarities between a sports-event contract, which even Kalshi calls ‘sports betting’, and a traditional sports wager are overwhelming.”
The case has drawn wider attention, with California Attorney General Rob Bonta and officials from 25 other states and Washington DC supporting the tribes. The court sent the case back to the district judge rather than immediately ordering Kalshi to stop offering its contracts on tribal land, though it noted the evidence could support an injunction.
