U.S. District Judge William M. Conley in Wisconsin granted a preliminary injunction on May 11, 2026, blocking Kalshi and Robinhood from offering sports event contracts on Ho-Chunk Nation lands, finding that the tribe is likely to succeed in its claim that the prediction market platform violated the Indian Gaming Regulatory Act (IGRA). This marks the first federal court ruling to side with a tribe in the nationwide litigation against Kalshi over its sports bets.
First Federal Win for Tribes: Reverses California Precedent
According to Bloomberg Law, the Ho-Chunk Nation, a federally recognized tribe, filed suit in August 2025 in the Western District of Wisconsin against Kalshi Inc., KalshiEX LLC, Robinhood Markets Inc., and Robinhood Derivatives LLC. The tribe sought a preliminary injunction in December 2025 to halt the platforms from offering sports event contracts to users on tribal lands while the case proceeds. Sixteen other tribes jointly signed an amicus brief in support of the tribe's position.
The decision directly contradicts a November 2025 ruling by U.S. District Judge Jacqueline Scott Corley in the Northern District of California, who denied a similar injunction sought by Blue Lake Rancheria, Chicken Ranch Rancheria of Me-Wuk Indians, and Picayune Rancheria of the Chukchansi Indians. Corley held that the plaintiffs had not demonstrated a likelihood of success on their IGRA claims, although she acknowledged the serious sovereignty and economic concerns raised. That ruling is now under appeal in the Ninth Circuit.
RICO Claims and Kalshi's Federal Preemption Defense
The Ho-Chunk case includes a unique Racketeer Influenced and Corrupt Organizations Act (RICO) claim, characterizing Kalshi’s sports event contract business as a “gambling fraud scheme,” alongside false advertising allegations. The trial is scheduled for May 24, 2027, before Judge Conley.
Kalshi has consistently argued throughout the Wisconsin litigation that its status as a CFTC-regulated Designated Contract Market (DCM) preempts IGRA. The company cited the Unlawful Internet Gambling Enforcement Act of 2006, which exempts DCM-traded contracts from the federal definition of “bet or wager,” as well as the CFTC’s self-certification process for new event contracts under the Commodity Exchange Act. These same arguments succeeded before Judge Corley but failed to sway Judge Conley.
State-Level Enforcement and Federal-State Tensions
Separately, Wisconsin Attorney General Josh Kaul filed three parallel lawsuits on April 23, 2026, in Dane County Circuit Court, naming Kalshi, Robinhood, Polymarket, Crypto.com (operating as Foris Dax Markets), and Coinbase as defendants for allegedly facilitating sports betting in violation of Wisconsin law as a Class I felony. “Thinly disguising illegal conduct doesn’t make it legal,” Kaul said in a virtual press conference, calling for the platforms to be “shut down.” In response, the CFTC sued Wisconsin and four other states for what it called interference with federal regulatory authority over derivatives markets.
Fragmented Federal Landscape
Conley’s ruling adds to a fractured preliminary injunction landscape across federal circuits. Kalshi currently has an injunction upheld by the Third Circuit in New Jersey, lost similar motions in Maryland, and saw its Nevada injunction vacated after reconsideration. In Arizona, a federal judge issued an emergency order temporarily halting the state’s criminal prosecution of Kalshi scheduled for the same day, citing potential CFTC preemption.
As of press time, Kalshi has not publicly responded to Conley’s ruling. Legal analysts expect the decision to embolden additional tribal lawsuits and potentially prompt the CFTC to revisit the regulatory boundaries of event contracts. The tension between IGRA and CFTC authority is emerging as a central battleground in U.S. gambling and financial regulation.