Kalshi won't be getting another chance to argue its Nevada case before the same federal appeals court. On Wednesday, November 4, the Ninth Circuit rejected the prediction market company's request to reconsider an earlier ruling involving its sports event contracts.
The decision keeps Kalshi's August 28 setback in place, leaving Nevada regulators free to pursue enforcement under state law. With the appeals court declining to revisit the dispute, Kalshi could now take its argument to the U.S. Supreme Court.
Ninth Circuit Closes the Door on Another Hearing
Kalshi had requested both a rehearing before the original three-judge panel and a review by the full appeals court. Neither request succeeded, with the panel unanimously denying rehearing and no judge calling for a full-court vote. The underlying dispute concerns whether federal regulation prevents Nevada from applying its gaming laws to Kalshi's sports contracts.
Kalshi argues that its registration with the Commodity Futures Trading Commission gives federal law priority over state restrictions. The Ninth Circuit previously disagreed with Kalshi's request for preliminary protection. Its August ruling upheld the removal of an injunction that had temporarily shielded the exchange from Nevada enforcement.
Supreme Court Could Be Kalshi's Next Stop
The latest decision starts a new deadline for Kalshi's legal team. The company generally has 90 days to petition the Supreme Court, putting its deadline at February 2, 2027, unless an extension is granted. There's no guarantee the justices will agree to hear the case. Still, Kalshi has reason to consider that step, especially because federal appeals courts have reached different conclusions about state authority over prediction markets.
Here's where things stand:
- Ninth Circuit: Kalshi's request for rehearing was denied.
- Supreme Court: A petition could be filed by February 2, 2027.
- Third Circuit: A separate New Jersey dispute has already reached the Supreme Court review process.
- CFTC: Public comments on proposed event-contract rules are due November 18.
Kalshi attorney Paul Clement could also consider coordinating the Nevada case with the pending New Jersey dispute.
Other Courts Aren't Giving Kalshi Much Relief
Nevada isn't the only place where Kalshi has encountered resistance. On November 3, the Second Circuit declined to provide temporary injunctions in Kalshi's New York and Connecticut cases, along with Coinbase's Connecticut dispute. Those appeals remain active, so the decisions don't settle the underlying legal questions.
They do, however, leave the companies without the additional temporary protections they requested. Kalshi is also facing challenges in several other states, including Utah, Ohio, Tennessee, and Louisiana. Each case adds another legal proceeding as the company continues defending its federally regulated business model.
Federal Regulators Have Their Own Timeline
While Kalshi fights in court, the CFTC is working on rules addressing event contracts. The agency issued proposed regulations and a companion interim final rule on October 9, with public comments due November 18. Those proceedings could influence how federal regulators approach sports-related contracts going forward. However, the rulemaking process and state court cases are moving separately, leaving Kalshi to navigate both at once.
The Trade Handle Prediction Markets Take
Kalshi's biggest challenge might be that its legal battles aren't moving together. One court can reject temporary protection while another considers whether federal law limits state enforcement. We think the Supreme Court question is becoming increasingly important. Conflicting appellate decisions create uncertainty for exchanges, regulators, and traders trying to understand where these contracts can operate.
Wednesday's denial doesn't end the Nevada lawsuit or guarantee Supreme Court involvement. It does leave Kalshi with fewer immediate options in the Ninth Circuit. For now, we'll be watching whether Kalshi files its petition and how the CFTC's upcoming rulemaking develops. Both could help shape the next chapter of this ongoing jurisdictional fight.