Kalshi En Banc Request Stays Ninth Circuit Ruling on State Gambling Enforcement

Kalshi’s request for an en banc rehearing has stayed a U.S. Ninth Circuit Court of Appeals panel decision that permitted Nevada to enforce its gambling laws against the platform’s sports event contracts. The August 28 ruling had opened the door for the eight other states in the circuit to pursue similar steps. That decision is now on hold, and most states cannot advance enforcement actions.

The filing allows Kalshi to continue offering its contracts in California during the peak sports season. It also prevents Arizona and Montana from pressing further federal moves amid their ongoing cases. Nevada and Washington already enforce their restrictions after state court rulings.

Status of Litigation in Affected Ninth Circuit States

Arizona faces multiple actions with Kalshi and the CFTC. Both federal and state cases are stayed, though Arizona has appealed the preliminary injunction that blocks its criminal charges and allows Kalshi to operate. The state attorney general’s office declined comment due to pending litigation.

In Montana, the deadline for the state to respond to Kalshi’s complaint is Thursday. A district court denied Kalshi’s preliminary injunction request in late August after both sides agreed to extensions. Washington secured a superior court order on August 13 requiring Kalshi to stop offering contracts on sports, elections, politics, entertainment, culture, tech, science or related mentions, effective September 2. The order cited “unfair and/or deceptive acts or practices” and required geofencing plus an advertising ban. Kalshi appealed, arguing unequal treatment of other platforms.

As Daniel Wallach (@WALLACHLEGAL) posted: “NEW: Arizona asks Ninth Circuit to enter summarily vacate the district court’s preliminary injunction order barring enforcement of the state’s gaming laws against DCMs offering sports-event contracts, says the CA9 opinion in Kalshi v. Nevada is “now the law of this circuit.””

Low Odds of Rehearing and Pending Supreme Court Petitions

The Ninth Circuit spans Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington, with 29 judges. It rarely grants en banc review. In 2024, 29 of 625 petitions were approved and nine succeeded. Kalshi must show a clear conflict with circuit precedent, an inter-circuit split created by the Third Circuit’s favorable ruling, or that the Ninth sits in the minority.

A key indicator is whether the court requests a response from Nevada; circuit rules state rehearing ordinarily will not be granted absent such a request. As reported by InGame, Robinhood separately asked the Supreme Court to take the case, while New Jersey and Robinhood have filed certiorari petitions. The first opportunity for review comes at the September 28 long conference.

The stay delivers temporary relief but leaves core questions unresolved. Regulators and platforms face continued fragmentation until either en banc review or Supreme Court action provides uniformity.

Reporting: InGame

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