Ninth Circuit Classifies Kalshi Sports Event Contracts as IGRA Class III Gaming on Tribal Lands

The U.S. Court of Appeals for the Ninth Circuit ruled that sports event contracts offered by prediction market platforms constitute class III gaming under the Indian Gaming Regulatory Act when transacted on Indian lands. On September 16, 2026, the court voted 3-0 to grant a preliminary injunction to the Blue Lake Rancheria and Chicken Ranch Rancheria of Me-Wuk Indians in the case Blue Lake Rancheria v. Kalshi, Inc.. The decision rests on the determination that these contracts violate IGRA, tribal gaming ordinances, and the tribes’ exclusive regulatory authority.

The court held that the challenged sports event contracts meet the definition of class III gaming because they involve the three required elements of chance, consideration, and prize or reward. It cited the Department of the Interior’s compact review to reinforce this view. Kalshi’s products are also located on Indian lands when a user enters into the event contract from tribal territory, placing them squarely within the tribes’ regulatory domain.

This outcome builds directly on the Ninth Circuit’s August 28 decision in KalshiEX, LLC v. Assad, which treated sports event contracts as gambling subject to state law. The court dismissed the prediction market argument that tribal-state compacts bind only the signing parties. Instead, it recognized that the tribes’ secretarial procedures and gaming ordinances prohibit unauthorized gaming, and Kalshi holds no such authorization from the tribes.

The Court’s Core Legal Holdings

The ruling states that “the challenged sports event contracts constitute ‘class III gaming activities [under IGRA]’” and that “Kalshi may reshuffle the cards, but it cannot change the hand: Its sports event contracts are Class III gaming.” It rejects any recharacterization of these products as financial instruments or innovations outside established gambling rules. According to reporting by Indian Gaming, the Indian Gaming Association has maintained this position for nearly two years, arguing that such contracts directly undermine tribal sovereignty, IGRA, and hundreds of tribal-state gaming compacts.

What the Decision Secures for Tribal Authority

Tribal gaming operations support more than 680,000 jobs and serve as economic anchors for communities. The Indian Gaming Association participated in the appeal as amicus curiae with the National Congress of American Indians, the California Nations Indian Gaming Association, and other tribal entities. David Z. Bean, Chairman of the Indian Gaming Association, noted the decision as a meaningful victory that protects the regulated framework tribes have built over decades. The opinion underscores that tribal gaming ordinances are not technical hurdles but core elements of the legal structure under IGRA.

The ruling does not resolve the full dispute. It does confirm that tribes can enforce their authority against unauthorized operators. Prediction market platforms must now account for this barrier when users are located on Indian lands.

Reporting: Indian Gaming

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