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Kalshi has secured another major win in its legal fight against Nevada gaming regulators, as a federal judge has denied a motion to dismiss the lawsuit that sought to stop its operations.
The company, which began offering sports prediction contracts late last year, found itself at odds with the Nevada Gaming Control Board (NGCB) after the board issued a cease-and-desist order. Regulators argued that Kalshi’s contracts closely resembled traditional sports wagering, and since the company is not licensed to accept bets in Nevada, they wanted to stop its operations.
In response, Kalshi filed a lawsuit in late March, claiming that its activities fall under federal jurisdiction and should be governed by the Commodity Exchange Act (CEA). It contends that CEA comes before state regulations, exempting it from the licensing requirements imposed on Nevada sportsbooks. Kalshi ended up receiving a preliminary injunction, preventing Nevada authorities from taking enforcement actions against it.
This Monday (June 3), U.S. District Judge Andrew Gordon rejected various arguments from the Nevada Gaming Control Board (NGCB), the Nevada Gaming Commission (NGC), and Attorney General Aaron Ford that aimed to close the litigation.
The court found Kalshi had sufficiently stated a legal claim and dismissed assertions that the suit was invalid regarding state agencies and officials. With the Monday ruling confirmed, Kalshi will continue to operate in Nevada as the case moves forward.
Nevada Resort Association Gets Permission to Enter the Case
Monday’s ruling also saw the Nevada Resort Association (NRA) receive the green light to join the ongoing lawsuit. Judge Gordon granted the NRA’s motion to intervene, allowing it to defend the interests of Nevada’s prominent casino-resort operators against Kalshi’s legal actions.
In its filing, the NRA stressed the importance of maintaining the integrity of Nevada’s gaming regulations, arguing that permitting Kalshi to operate without adherence to state laws would disrupt the competitive landscape.
The organization represents 70 casino resorts and pointed out that Nevada’s licensed sportsbooks processed over $7.8 billion in sports wagers in 2024 alone. The NRA warned that if companies like Kalshi were allowed to operate outside the state’s regulatory framework, it could lead to serious instability in the gambling market.
Judge Gordon noted that the MNRA’s members have “significantly protectable interests” in their gaming licenses, which they have invested heavily in obtaining and maintaining. While Kalshi argued that the NRA’s request to intervene was not timely, the judge countered that a response filed 47 days after the lawsuit began was adequately prompt.
The case raises critical questions about the balance between federal commodities regulation and state gambling laws. If Kalshi were to win, the NRA warned that its members could find themselves at a substantial competitive disadvantage, as Kalshi would not have to follow the same comprehensive gaming laws that govern Nevada’s licensed operators.
Source: Next.io
