Kalshi lost another round in court after a unanimous three-judge panel of the U.S. Court of Appeals for the Sixth Circuit ruled that Ohio and Tennessee may regulate the company’s sports event contracts under state gambling laws. The panel also said Kalshi failed to show that the contracts fall under the U.S. Commodity Futures Trading Commission’s jurisdiction as "swaps." The ruling lines up with a decision from the Ninth Circuit last month. At the same time, it stands against an April ruling from the Third Circuit, which allowed Kalshi to keep operating in New Jersey while litigation continued. That split among federal appeals courts now puts the issue on a path that could reach the U.S. Supreme Court. State lawmakers have already filed amicus briefs asking the court to decide whether state governments or federal agencies have authority over prediction markets.
Odaily reported that a unanimous three-judge panel of the U.S. Court of Appeals for the Sixth Circuit ruled that Ohio and Tennessee may regulate Kalshi’s sports event contracts under state gambling laws. The panel also found that Kalshi failed to prove the contracts are "swaps" subject to the jurisdiction of the U.S. Commodity Futures Trading Commission.
The decision matches the conclusion reached by the Ninth Circuit last month. But it conflicts with an April ruling from the Third Circuit, which said Kalshi could continue operating in New Jersey while the lawsuit was pending.
Several state lawmakers have already submitted amicus briefs to the U.S. Supreme Court, asking it to decide whether state governments or federal agencies have jurisdiction over prediction markets.
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