Kalshi files for Ninth Circuit en banc review in state preemption fight

Kalshi's two-front legal campaign is now running on parallel tracks — one asking the Ninth Circuit to reconsider its preemption argument as a full court, the other watching Robinhood carry the same constitutional question toward the Supreme Court.

The en banc petition asks the Ninth Circuit to reassemble its full bench and reverse the panel decision that denied Kalshi injunctive relief against state gaming enforcement. Robinhood's cert petition takes a different path: it asks the Supreme Court to settle whether the Commodity Exchange Act displaces state authority over event contracts before any more state courts get to weigh in. The two companies are making the same argument in different rooms.

That structural fact is the one the reporting has not pressed hard enough. When two regulated entities pursue parallel federal appeals on identical preemption grounds, they are not hedging — they are betting that one venue cracks before the other closes. What they are also doing, though neither company will say this, is making it harder for courts to stay coordinated. A Ninth Circuit en banc panel ruling against Kalshi does not bind the Supreme Court. A cert grant by the Supreme Court does not automatically pause Kalshi's state-court exposure. The timelines do not fit together neatly, and the gap between them is where enforcement lives.

The CFTC's position on what constitutes "gaming" remains the unresolved centre of all of this. The agency has not produced a definition that a court can use as an anchor. Without one, every state that wants to contest jurisdiction has the same opening Iowa used — and Iowa's judge read Congressional silence as permission, not prohibition. That is a legal theory with momentum, and Kalshi's en banc filing does not neutralise it; it contests it at a different elevation.

Here is where my read diverges from the coverage: the two-track strategy is rational only if one track succeeds fast enough to stop compounding losses in state courts. The more states that rule against Kalshi before either federal appeal resolves, the harder the preemption argument becomes to sustain politically, even if it holds legally. Judges read newspapers. Appellate panels notice when the entity asking for relief has accumulated a losing record in seven jurisdictions. The legal argument may be sound; the optics of it are deteriorating with each additional state filing.

Robinhood's Supreme Court petition is the cleaner play. A cert grant would freeze the field. But cert is granted in a small fraction of petitions, and the Court has no obligation to move quickly. Kalshi's en banc bid is the pressure valve — if it succeeds, it gives the company something to point to while the slower track grinds forward.