California tribes have secured the nation’s first preliminary injunction against Kalshi under federal Indian gaming law, turning restrictions the prediction market operator voluntarily implemented in September into a binding court order.
U.S. District Judge Jacqueline Scott Corley granted the injunction Wednesday, prohibiting Kalshi from offering sports contracts on the plaintiff tribes’ Indian lands while their lawsuit proceeds. The California injunction follows a September Ninth Circuit ruling that found Blue Lake Rancheria and Chicken Ranch Rancheria of Me-Wuk Indians likely to succeed in their claims that Kalshi violated the federal Indian Gaming Regulatory Act.
Under the order tribes must provide Kalshi with maps identifying the affected territories by Nov. 13. Kalshi must submit a report detailing its compliance efforts by Nov. 25.
California tribes secure injunction
The three-judge panel determined that Kalshi’s sports contracts constitute Class III gaming under federal tribal gaming law and that federal commodities law does not override the tribes’ authority to regulate gambling on their lands.
Kalshi began blocking access to its sports contracts on three reservations in late September, though tribes have disputed the effectiveness of that geofencing, alleging that tribal gaming officials are still able to place bets on that land.
Corley, who initially denied the tribes’ request for an injunction last November, granted it Wednesday after the Ninth Circuit returned the case to her court for further consideration.
Kalshi faces opposition nationwide
Native American tribes have increasingly challenged prediction markets over alleged violations of their sovereignty and gaming rights. Unlike state regulators, tribes can pursue claims under the Indian Gaming Regulatory Act, which governs gambling on Indian lands.
The Ho-Chunk Nation has pursued a similar lawsuit against Kalshi in Wisconsin, where a federal judge allowed its claims to proceed but denied a preliminary injunction.
On Wednesday, the Ninth Circuit dealt Kalshi another setback in Nevada, refusing to overturn a ruling allowing the state to enforce its gambling laws against the company. The Sixth Circuit has similarly allowed Ohio and Tennessee to enforce their gambling laws, while Kalshi has secured favorable rulings in Illinois and New Jersey. New Jersey has asked the Supreme Court to resolve the conflicting interpretations.
Kalshi maintains that its sports contracts are federally regulated financial instruments, not gambling. The Commodity Futures Trading Commission has backed that position, suing states over enforcement efforts and asserting exclusive federal jurisdiction.
California remains key Kalshi market
California voters overwhelmingly rejected two proposals to legalize sports betting in 2022, leaving it the nation’s most populous state without legal wagering.
Despite the statewide prohibition, Kalshi has offered sports contracts to California customers since launching those markets in January 2025. Eilers & Krejcik Gaming estimated in May that California and Texas combined accounted for 43% of Kalshi’s trading volume, based on search and advertising data.
California has not taken enforcement action against prediction markets, though Atty. Gen. Rob Bonta is one of 37 state attorneys general backing Utah in its lawsuit against operators.
