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A U.S. District judge granted a preliminary injunction prohibiting Kalshi from offering sports contracts on California tribal land, according to Yahoo Finance’s Nov. 7 report. The injunction was granted to Blue Lake Rancheria and Chicken Ranch Rancheria of Me-Wuk Indians in a case alleging violations of the Indian Gaming Regulatory Act.
Courts Reject Kalshi’s Preemption Arguments
In the California case, a court panel ruled that Kalshi’s sports prediction trading constituted Class III gaming. The court found that Commodity Futures Trading Commission regulations governing Kalshi did not preempt the Indian Gaming Regulatory Act.
Other court decisions have allowed states to apply their gambling laws to the platform. According to Yahoo Finance, a 6th U.S. Circuit Court of Appeals panel ruled that Ohio and Tennessee could apply state gambling laws to Kalshi contracts, while a 9th Circuit panel allowed Nevada to ban Kalshi outright.
A 2nd Circuit decision denied Kalshi’s request for a preliminary injunction in cases involving New York and Connecticut.
Arkansas Lawsuit and Utah Criminal Charges
Arkansas Attorney General Tim Griffin announced a lawsuit against Kalshi under the state’s Deceptive Trade Practices Act over alleged illegal gambling operations. Arkansas and New York, which has sued Kalshi for unlicensed gambling, also allege that the platform violates state gambling age requirements.
“It doesn’t take a genius to understand that wagering money on whether the Razorbacks win or lose is gambling. And gambling on an unregulated platform is squarely prohibited by Arkansas law,” Griffin said in a statement quoted by Yahoo Finance.
Utah filed criminal charges against Kalshi and its co-founders, Tarek Mansour and Luana Lopes Lara. The charges include counts of unlawful activity, online gambling promotion and general gambling promotion. Those charges are allegations, not findings of guilt.
Kalshi Defends Its Trading Model
Kalshi maintains that its “swaps” are not bets and that it operates as a designated contract market trading in futures contracts and derivatives. The company has sued states over their attempts to regulate its operations.
More from playwv.com – Polymarket Seeks Injunction Against Ohio Sports Betting Enforcement – NBA Names Kalshi and Polymarket Partners With Integrity Safeguards – Kalshi, Polymarket and Founders Give at Least $5 Million as Scrutiny Grows
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Source: As reported by Yahoo Finance.
