The Supreme Court could rule on the future of sports prediction markets by June 2027, according to gaming attorney Daniel Wallach, though regulatory changes and competing appeals could delay a decision.
- Conflicting appeals court rulings strengthen the case for Supreme Court review of sports prediction markets.
- CFTC rule changes and Kalshi’s rehearing request could delay a decision beyond June 2027.
- Daniel Wallach estimates states have a 70%-80% chance of winning if the Supreme Court hears the dispute.
Speaking at last week’s Global Gaming Expo in Las Vegas, Florida-based gaming attorney Daniel Wallach outlined a potential timeline that would see the justices take up the cases in December 2026 or January 2027, hear arguments in March or April, and issue a decision by June.
He described that as the "quickest" possible scenario, with a later decision at least equally plausible. If the court does not agree to hear the cases by early next year, a ruling likely would not come until at least 2028.
The timing could determine how much longer prediction market companies operate under conflicting court decisions. The dispute centers on whether federal commodities regulation allows platforms to offer sports event contracts nationwide without having to comply with state gambling laws.
Wallach’s timeline depends partly on whether the Supreme Court considers the competing appeals together. New Jersey officials have asked the justices to review a Third Circuit ruling favoring Kalshi, while Robinhood and Crypto.com have pursued review of the Ninth Circuit’s contrary position.
Wallach interpretedthe companies’ filings and Kalshi’s request for more time to respond to New Jersey’s petition could help align the proceedings. Taking multiple cases together could give the justices competing interpretations of the same federal law rather than a single ruling to examine.
Case background
The Philadelphia-based Third Circuit sided with Kalshi in April, finding its sports event contracts fit within the federal definition of swaps. The San Francisco-based Ninth Circuit reached the opposite conclusion Aug. 28, affirming the dissolution of an injunction that had protected Kalshi from Nevada enforcement over its sports offerings.
That decision concerned preliminary relief rather than a final resolution of every claim.
The Sixth Circuit, based in Cincinnati, added another ruling favorable to states Sept. 25. It upheld the denial of Kalshi’s requested injunction in Ohio and vacated an injunction protecting the company in Tennessee, further deepening the split among federal appeals courts.
Though the nation's highest court hasn’t indicated it will take up the prediction market question, Wallach said the contrasting legal approaches provide a strong foundation for judicial review. He characterized the Third Circuit as relying on a broad reading of statutory language, while the Sixth and Ninth circuits examined sports contracts within the financial risk-management framework of commodities law.
The Ninth Circuit’s opinion rejected the premise that Congress transferred nationwide sports gambling authority to federal commodities regulators through legislation addressing financial markets. Its analysis distinguished sports bets from financial derivatives covered by the Commodity Exchange Act, the federal legislation prediction markets have argued gives them legal authority to offer sports event contracts.
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Regulatory changes could slow review
A separate federal rulemaking process could complicate the proposed timeline.
Wallach said the federal Commodity Futures Trading Commission, which has maintained exclusive nationwide regulatory oversight, was urging courts to wait for new event-contract regulations. He also said Robinhood’s Supreme Court filing argued against immediate review because those changes could materially alter the legal landscape.
The existing CFTC gaming-contract prohibition was one basis for the Ninth Circuit’s ruling. The court said proposed regulatory changes had no legal effect while the current rule remained in place. Kalshi has argued the disagreement turns partly on a regulation the agency is working to rewrite.
Wallach said rules specifically addressing sports contracts could strengthen the platforms’ case. But he maintained that changing regulations would not necessarily overcome the broader question of whether Congress authorized these products to displace state gambling oversight.
Kalshi’s Ninth Circuit rehearing request presents another potential delay. Holland & Knight gaming attorney Joshua Kirschner previously told Covers that a rehearing could substantially reduce the likelihood of immediate Supreme Court intervention, while a denial would leave a clearer conflict for the justices to resolve.
In comments to Covers at last week’s conference, Wallach said there was a minuscule chance the Ninth Circuit granted the rehearing petition.
Tribal litigation adds another possible complication.
In a separate ruling, the Ninth Circuit found tribes likely to succeed on claims that unauthorized sports contracts offered on their lands violate the federal Indian Gaming Regulatory Act. It returned the case for consideration of the remaining injunction requirements.
Though a different legal battle, it underscores the continued, multifaceted effort against prediction market sports event contracts.
Wallach estimated states have a 70%–80% chance of prevailing at the Supreme Court, while cautioning that lower-court momentum cannot guarantee the outcome. He pointed to New Jersey’s eventual victory overturning the federal sports betting ban in 2018 after repeated earlier defeats.
“I’d love to say a 100%, but there are no guarantees when you get to the high court,” Wallach said.
