Kalshi Prevails as Nevada’s Motion to Dismiss Lawsuit Fails
Kalshi just notched another legal victory in Nevada, keeping its prediction markets alive as a federal judge shot down the state’s attempt to kill the case.
A Federal Court Stands with Kalshi
U.S. District Judge Andrew Gordon rejected Nevada’s motion to dismiss a lawsuit filed by Kalshi. The ruling, a blow to the Nevada Gaming Control Board (NGCB), Nevada Gaming Commission (NGC), and Attorney General Aaron Ford, lets Kalshi keep operating in the state while the case unfolds.
Gordon dismissed Nevada’s claims of Eleventh Amendment immunity and, for now, their judicial estoppel argument, which accused Kalshi of flipping its stance on sports contracts’ legality. “Kalshi has plausibly alleged the CEA preempts Nevada gaming laws,” Gordon wrote, reinforcing a prior injunction from April.
Kalshi’s battle kicked off when the NGCB issued a cease-and-desist order in March, claiming Kalshi’s event contracts mimicked unlicensed sports betting. Kalshi fired back with a lawsuit, arguing its Commodity Futures Trading Commission (CFTC) registration puts it under federal law, not state gaming rules.
“State law doesn’t really apply,” said CEO Tarek Mansour. The Commodity Exchange Act (CEA), Kalshi insists, gives the CFTC sole authority over its markets, trumping Nevada’s regulations. Gordon’s earlier rulings, including a temporary restraining order on April 8 and a preliminary injunction on April 9, already signaled Kalshi’s “likelihood of success” on this point.
With the motion to dismiss denied, Kalshi’s markets stay live in Nevada. The case now heads toward a final ruling, with Crypto.com filing a similar suit against Nevada.
Nevada Resorts Join the Fray
Recently, the Nevada Resort Association (NRA), representing 70 casinos, won approval to intervene in the case. The NRA argues Kalshi’s contracts dodge state taxes and oversight, putting licensed sportsbooks at a disadvantage.
“NRA’s members have significantly protectable interests in their Nevada gaming licenses,” Gordon noted, citing the $7.8 billion in sports bets Nevada handled in 2024. If Kalshi prevails, the NRA warns, casinos could face “considerable competitive disadvantage” as Kalshi skips rules like age limits and bet restrictions.
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