U.S. District Court Judge Andrew Gordon said he'd move quickly on the Nevada Resort Association's (NRA) May 14 motion to intervene in the ongoing legal battle between prediction market Kalshi and the Nevada Gaming Control Board (NGCB).
Key takeaways
- Judge Gordon will decide if the Nevada Resort Association can intervene before broader rulings reshape state gaming control.
- The NRA warned Kalshi undermines licensed sportsbooks and state gambling revenue protections.
- Kalshi's federal license challenges Nevada's authority to regulate and tax sports-style prediction markets.
The lawsuit, which Kalshi filed on March 28, challenges the state's authority to shut down the company's operations in Nevada. Kalshi argues it's authorized to operate nationwide under the federal Commodity Futures Trading Commission (CFTC)'s oversight, which classifies its contracts as event-based futures rather than gambling wagers.
On April 23, the Nevada Gaming Control Board filed a motion to dismiss Kalshi's lawsuit. However, Judge Gordon issued a temporary restraining order shortly after, barring the state from forcing Kalshi to halt its operations. The judge is now considering whether to let the NRA intervene, with the organization's reply briefs due by May 28 following Kalshi's opposition filed on May 16.
The NRA, which represents 70 casino resorts across Nevada, emphasized the potential for significant financial disruption if Kalshi is allowed to operate unregulated prediction markets in the state. The association notes Nevada's sports betting industry processed $7.8 billion in wagers during 2024, all under strict state regulation and taxation. In court filings, the NRA warned the consequences of letting Kalshi continue could be "seismic" for the established gaming industry.
Currently, there's no estimate of how much revenue the state may have lost due to Kalshi's operations. Both the NRA and the Gaming Control Board cited the urgency of the case, warning the longer Kalshi continues unchecked, the greater the potential disruption to Nevada's tightly regulated gaming economy.
Definition of prediction markets remains unclear
The central issue is whether Kalshi's market offerings are functionally equivalent to traditional sports bets. According to the NRA, Kalshi's contracts offer the same economic outcomes as bets placed with Nevada sportsbooks but aren't subject to state taxes or regulatory safeguards.
The NRA highlighted Kalshi users in Nevada can currently place wagers on local sports teams, such as $100 on the Las Vegas Golden Knights to win a playoff game. The state receives a payout equivalent to one from a regulated sportsbook, but gets no tax revenue from the transaction.
Kalshi, based in New York, maintains it's not offering gambling products but instead operates a federally sanctioned financial exchange dealing in event contracts. The company argues the CFTC's jurisdiction preempts state laws and lets Kalshi legally operate in all 50 U.S. states, including jurisdictions that haven't authorized traditional sports betting, such as California and Utah.
New Jersey and Maryland also issued Kalshi cease-and-desist orders, but courts blocked their efforts in those states as well.
