An Illinois Federal District court has granted preliminary injunction motions from Kalshi, Coinbase and the Commodity Futures Trading Commission (CFTC), representing the first victory for prediction market entities in nearly six months.
In April, a Third Circuit Court in Philadelphia ruled in favor of Kalshi by declaring the CFTC maintained exclusive jurisdiction over sports event contracts and preempted New Jersey’s gaming laws.
Since the decision was handed down, though, a Ninth Circuit Court voted unanimously to forbid Kalshi from filing enforcement action against Nevada regulators, having determined that the Commodity Exchange Act is unlikely to preempt regulations enforced by the Nevada Gaming Commission.
After the Ninth Circuit decision, New Jersey Attorney General Jennifer Davenport filed an inaugural petition with the US Supreme Court to determine whether prediction markets can legally offer sports-related event contract trading without following state gaming regulations.
On September 28, the US Court of Appeals for the Sixth Circuit also ruled against Kalshi in its disputes with gambling regulators in Ohio and Tennessee, finding the prediction market operator had yet to establish that its sports event contracts fall exclusively under federal regulation.
Following the Illinois ruling, however, Wallach Legal Founder Daniel Wallach believes an “intra-circuit split” was created with a previous decision handed down in Wisconsin that moved two questions concerning Tribal gaming authority toward the Seventh Circuit.
The Ho-Chunk Nation Tribe sued Kalshi and Robinhood over event contracts accessible on its Tribal lands, alleging the products constitute unauthorized class III gaming under the Indian Gaming Regulatory Act.
The Seventh Circuit court will also be asked to determine whether the Commodity Exchange Act or Unlawful Internet Gambling Enforcement Act preempts the Tribe’s authority.
Just prior to the Illinois decision, Nevada lawmakers rebuked Kalshi’s attempt to “delay” adherence to the Ninth Circuit ruling as part of a letter sent by Mayer Brown Partner Nicole Saharsky to Clerk of Court Molly Dwyer.
Nevada's nonrestricted gaming licensees generated $1.27bn in gaming win during August 2026, an increase of 3.1% year-over-year, according to the Nevada Gaming Control Board on October 1
