Judge Presiding Over Kalshi Case in Nevada Promises Quick Action

A federal court case against prediction platform KalshiEx LLC in Nevada could soon transform the state's sports-betting industry. A U.S. District Court judge, Andrew Gordon, has promised quick action as he weighs motions from the Nevada Gaming Control Board (NGCB) and the Nevada Resort Association (NRA), which is requesting to join the lawsuit Kalshi filed in March.

Kalshi's prediction markets have been blasted in several states. The company contends that, because it is overseen by the Commodity Futures Trading Commission (CFTC), its federally authorized trading platform is exempt from the jurisdiction of state gambling regulators. That includes the Nevada sports betting market, where sports betting is closely controlled and taxed under state law.

In the May 20 case updates, Judge Gordon directed Kalshi to file its opposition to the NRA's motion by May 23 and a final reply from the NRA by May 28. A ruling on the motion to intervene may be expected soon afterward, and perhaps on other parts of the case.

Judge Gordon has already issued a temporary restraining order (TRO) that prevents Nevada regulators from enforcing against Kalshi during the pendency of the case. The TRO currently allows Kalshi to maintain its open market in Nevada despite the lawsuit, and residents can continue to take advantage of a Kalshi promo code.

Casino operators speak up

The NRA, representing its 70 statewide casino resorts, argues Kalshi's business competes with licensed Nevada sportsbooks without providing state tax revenue. According to the NRA, Nevada's licensed sportsbooks took in $7.8 billion in sports wagers in 2024. 

The association argues that Kalshi's business model is identical to traditional sportsbooks, but it lacks the regulation or fiscal responsibility demanded by Nevada law.

In court documents, the NRA provided a hypothetical example in which a Nevada resident can wager $100 on the Vegas Golden Knights through Kalshi or a licensed sportsbook and receive the same $180 payout if the team wins. However, only the legacy sportsbook transaction would generate tax revenue for Nevada.

The NRA contends that this demonstrates Kalshi is conducting untaxed sports betting under the pretense of federal regulation.

Complicating the matter is Kalshi's past activity with political outcomes. Nevada's state constitution forbids explicitly wagering on elections, but Kalshi has offered contracts tied to election outcomes. This has also raised red flags for the NGCB and the NRA, especially as Kalshi is still marketing itself in sportsbook vernacular.

The position has already spawned legal fights in other states. New Jersey and Maryland have both issued cease-and-desist orders against Kalshi, but the enforcement actions were stayed in federal court.