Ninth Circuit Refuses Tribal Request in Prediction Market Battle

The Ninth Circuit Court of Appeals has rejected a request from several California tribes seeking to connect their lawsuit against Kalshi and Robinhood with a separate high profile prediction market case unfolding in Nevada.

The decision adds another layer to the growing legal battle surrounding prediction markets as states, tribes, and federal regulators continue fighting over who controls this ever growing sector.

Tribal Groups Push for Combined Review

Three California tribes, Blue Lake Rancheria, Chicken Ranch Rancheria of Me Wuk Indians, and Picayune Rancheria of the Chukchansi Indians, had asked the Ninth Circuit to assign their appeal to the same judicial panel handling the consolidated Nevada prediction market case involving Kalshi, Robinhood, and Crypto.com.

The tribes said the cases shared overlapping legal questions surrounding event contracts and federal regulation under the Commodity Exchange Act. At the same time, the tribal lawsuit also raises separate issues surrounding tribal sovereignty and gaming authority on reservation lands.

The Court Keeps the Cases Separate

The Ninth Circuit ultimately declined the request, meaning the tribal appeal and Nevada legal fight will continue moving forward independently. While the legal questions overlap in some areas, the court appears to view the tribal sovereignty issues as distinct enough to justify separate consideration.

That decision could slow efforts to create a more combined legal path around prediction market issues currently spreading across multiple states and jurisdictions.

Another Legal Front Opens in Washington

At the same time, Kalshi is also attempting to pause a separate lawsuit filed by Washington state. The company recently asked a federal judge to stay Washington’s case while its appeal over legal authority issues moves through the Ninth Circuit.

Washington regulators accuse Kalshi of operating an illegal gambling platform under state law, while Kalshi continues to say that its event contracts fall under exclusive federal oversight through the Commodity Futures Trading Commission. The disagreement shows the larger conflict now defining the prediction market industry.

Tribal Sovereignty Remains a Major Issue

What makes the tribal lawsuit different is its focus on tribal gaming rights. The California tribes continue to say that sports event contracts offered by Kalshi amount to Class III gaming under the Indian Gaming Regulatory Act, which they say interferes with tribal authority over gaming operations on reservation land.

That adds another legal dimension beyond the ongoing state versus federal regulatory debate already surrounding prediction markets.

Pressure Continues Building Around Prediction Markets

The industry is now facing challenges from multiple directions. States including Nevada, Arizona, Wisconsin, Ohio, Connecticut, and Washington have all taken action against prediction market operators in recent months.

At the same time, tribal nations are increasingly becoming part of the legal focus as prediction markets move further into sports related contracts traditionally associated with regulated gaming.

Where the Legal Fight Moves From Here

The Ninth Circuit’s latest decision does not resolve the bigger questions that is going around prediction markets, but it does show how divided the legal landscape is becoming. Instead of one single court battle, separate cases involving states, tribes, regulators, and operators are now developing across multiple jurisdictions at the same time.

For prediction market companies, that means the legal uncertainty around sports event contracts is far from slowing down.

Stay tuned to UMG Gaming for more updates on regulation, tribal gaming, and the evolving U.S. gaming landscape.