Supreme Court receives dual amicus pressure on Kalshi sports contracts

Ben Haden did not use diplomatic language. The President of the International Association of Gaming Regulators told the Supreme Court in an October 2 filing that regulators need clarity about their authority "to enforce proven safeguards" — which is a regulator's way of saying that the current arrangement is untenable and someone with finality needs to say so.

The filing was joint with the North American Gaming Regulators Association, the second amicus brief lodged in support of New Jersey's petition in Flaherty v. KalshiEX. The first came from the National Council of Legislators from Gaming States nine days earlier. The structure of that sequence matters: lawmakers who write state gaming rules, then the regulators who enforce them, both telling the same court that the Sixth and Ninth Circuits have the better view of federal preemption — and that the Third Circuit does not.

The Third Circuit's April ruling remains Kalshi's only federal appellate victory. That court found the company's sports event contracts likely qualify as swaps under the Commodity Exchange Act, and that federal law likely preempts New Jersey's sports-wagering statutes. The Ninth Circuit reached the opposite conclusion in August, holding that Nevada's gaming laws apply to prediction market sports contracts and refusing to accept that Congress handed nationwide authority over sports gambling to federal commodities regulators through legislation designed for financial markets. The Sixth Circuit has sided with the states as well.

The brief before the Court puts the practical consequence plainly: the same product, offered by the same company under the same federal registration, is presently shielded from state authority within the Third Circuit and subject to it within the Sixth and Ninth. Gaming attorney Daniel Wallach has projected the justices could resolve this by June 2027.

The reporting frames this as a regulatory coalition building pressure for Supreme Court review. The consensus read is that the circuit split creates obvious conditions for certiorari, and that the amicus filings simply accelerate an already likely outcome.

That framing underweights something. The two amicus briefs signal not just that state-side actors want the Court to intervene — they signal that the state coalition is now formally unified at the institutional level, with both rule-writers and rule-enforcers on record before the Court uses exactly the same doctrinal argument. In previous regulatory conflicts of this kind, that degree of coordination has tended to influence not just whether the Court grants cert, but how it frames the question it agrees to answer. A narrowly granted cert question that focuses on the swap classification issue, rather than the broader preemption question, would be structurally favorable to the state position even before oral argument.

Kalshi's position rests on a single circuit holding that is now isolated on both sides by courts that read the Commodity Exchange Act more narrowly. The Third Circuit's reasoning on swap classification has not been endorsed anywhere else, and the two briefs filed this month have now given the Supreme Court a curated doctrinal map showing exactly where the split lies and why it should be resolved against Kalshi's preferred reading.