Nevada Fires Back in Kalshi Case, Seeks Dismissal of Betting Claims

A High-Stakes Rebuttal

Nevada’s legal team, led by attorneys like Jessica E. Whelan and Aaron D. Ford’s office, is swinging hard to shut down KalshiEX, LLC’s bid to offer sports and political betting contracts, per court filings.

“This Court’s preliminary injunction ruling does not bind this Court moving forward, as the Court may reconsider, rescind, or modify any of its prior interlocutory rulings at any time as part of its inherent authority,” Nevada argued, rejecting Kalshi’s claim that prior rulings lock the state’s defense. W

Nevada’s motion dismantles Kalshi’s assertion that its contracts are “swaps” or “futures” under the Commodity Exchange Act (CEA).

“The majority of Kalshi’s substantive arguments rest on the faulty premise and conclusory allegation that its contracts are ‘swaps’ or ‘contracts for sale of a commodity for future delivery,’” the state declared, calling Kalshi’s claims “self-serving and conclusory.”

Nevada insists that sports and election outcomes lack the “financial, economic, or commercial consequences” needed for CEA coverage.

“An election or a sports game is not an item that is owned or an item that has value,” the state added, arguing these aren’t deliverable commodities. Kalshi’s failure to counter this “constitutes consent to the granting of the motion,” Nevada asserted.

Procedural Power Plays

Nevada’s defense leverages procedural heft, too. The state invokes Eleventh Amendment immunity for the Nevada Gaming Control Board (NGCB) and Nevada Gaming Commission (NGC), arguing, “First, Eleventh Amendment immunity bars claims against them, as arms of the State, in federal court.”

Nevada denies waiving immunity, noting, “The relief requested in Defendants’ countermotion was quite appropriately the inverse of the relief requested in Kalshi’s motion, making it precisely the type of ‘defensive’ argument found to not waive Eleventh Amendment immunity.”

Kalshi’s improper naming and failure to serve the Attorney General’s office, per Nevada’s rules, further weaken its case. “Kalshi took no action to cure any of the procedural defects raised,” Nevada pointed out, cementing its push for dismissal.

Nevada, with the Nevada Resort Association’s support, argues the CEA doesn’t preempt state gaming laws. “Section 2(a)(1)(A)’s ‘Exclusive Jurisdiction’ Language Does Not Evince a Congressional Intent for the CEA to Occupy the Entire Field of Futures Markets,” the state contended, aligning its regulations with the CEA’s anti-abuse goals.

Accepting Kalshi’s stance would lead to an “absurd result clearly not within the contemplation of Congress,” allowing “de facto sports betting across state lines with no oversight by Nevada or any other state gaming authority.” Nevada’s laws work “parallel to and not through” the CEA, bolstered by federal gambling statutes and the Tenth Amendment, ensuring state control over betting platforms like Kalshi’s.

“The Court can and should determine as a matter of law that Kalshi’s sport and political events contracts are not contracts governed by the CEA,” Nevada urged, citing recent rulings like Loper Bright.