Ninth Circuit sends Kalshi election market case back to lower court

The Ninth Circuit, having ruled against Kalshi on sports event contracts in Nevada, declined to resolve a second question that had been joined to the same case: whether federal law prevents Nevada from applying its gambling regulations to Kalshi's election contracts specifically.

The appeals court has remanded that question to the district court, leaving the election market preemption argument unresolved at the circuit level.

The distinction matters. Sports contracts and election contracts sit differently within the Commodity Exchange Act's framework, and the Ninth Circuit's reluctance to treat them identically suggests the court saw the legal arguments as genuinely separable. The district court will now have to work through the election market question from the ground up.

For Kalshi, the remand extends the Nevada litigation on a second front at the same moment the company is pressing toward a Supreme Court petition on the sports contract ruling. Two simultaneous proceedings in the same jurisdiction, on related but legally distinct questions, will demand parallel legal strategies and carry separate resolution timelines.

Nevada's position has been that the federal exemption Kalshi claims does not reach contracts that function, in practice, as wagers on discrete events. Whether that argument holds for election contracts — which the CFTC has already permitted once, in a prior legal fight Kalshi won — is now the district court's problem to answer.