State Attorneys General Urge Supreme Court Review in Kalshi Case

A bipartisan coalition of 39 state attorneys general and the District of Columbia has asked the U.S. Supreme Court to review a federal appeals court decision that sided with Kalshi in the fight over sports-event contracts. The amicus brief, filed October 7, 2026 in Flaherty v. KalshiEX LLC, supports New Jersey's petition for certiorari and arrives as Kalshi's response to that petition comes due on Monday, November 9. For tribal gaming operators, who have filed their own brief in the case, the attorneys general coalition adds state-level weight to an argument tribes have been making for months.

What the coalition argues

The attorneys general contend that sports-event contracts listed on a federally regulated exchange should not be treated as federally exclusive "swaps" under the Commodity Exchange Act. In their telling, Congress did not clearly override the states' longstanding authority over gambling when it amended federal derivatives law, and a platform cannot remove a wager from state regulation by relabeling it as a financial contract. States, they note, have made different policy choices, with some legalizing sports betting and others prohibiting it, and those choices are the states' to make.

The coalition also frames the litigation as a "national turf war" producing conflicting appellate rulings. That point goes to the heart of whether the Supreme Court is likely to step in. The Third Circuit ruled in April that Kalshi's sports-event contracts are federally regulated swaps not subject to state gambling enforcement, and New Jersey officials are asking the justices to overturn that decision. Two other circuits have ruled the other way this year, in favor of state regulators. Our coverage of the Sixth Circuit split and its tribal implications and the Ninth Circuit's Blue Lake Rancheria ruling traces how those decisions developed.

A crowded field of supporters

The attorneys general were not alone. According to trade coverage of the filings the week of October 9, amicus briefs supporting New Jersey also came from the National Football League, from 145 tribes and tribal organizations, from Christopher Dodd, the namesake sponsor of the Dodd-Frank Act, and from Gary Gensler, a former chairman of the Commodity Futures Trading Commission. The petition has been docketed as No. 26-299.

The briefs approach the question from different directions. The NFL argues that insider-trading policies are ineffective without knowing who the insiders are, and wants platforms to coordinate on prohibited-bettor lists and to bar certain contracts, such as those that one person can manipulate or that turn on officiating. Gensler argues that Congress never discussed sports betting when it passed Dodd-Frank and that the CFTC never sought resources to regulate it. Dodd's brief, as summarized in that coverage, says the law was meant to strengthen financial oversight while preserving state and tribal gambling authority.

The tribal brief, prepared by the Native American Rights Fund with outside counsel and covered in more detail in our report on the tribal amicus filing, argues that prediction platforms offer sports wagering on tribal lands without authorization, including on lands where tribes have banned gaming. Tribes contend that these platforms compete for revenue that funds health care, housing, education and public safety while avoiding compacts, revenue-sharing obligations and gaming regulation.

What happens next at the Court

The procedural calendar is worth understanding because the next several weeks will determine whether the case is heard this term. Kalshi's response to the petition is due November 9. After a response, the petitioner may file a reply, and the case is then distributed to the justices for consideration at a conference. The Court grants review when at least four justices vote to take a case. Nothing in the filings guarantees that outcome, and the justices have not yet agreed to hear the dispute. Legal observers have said it could be taken up as early as this year, but that is an expectation, not a schedule.

Kalshi's position, which the platform has pressed in the lower courts, is that its contracts fall within the exclusive jurisdiction of the CFTC under the Commodity Exchange Act as amended by Dodd-Frank. The company and its supporters argue that a uniform federal framework is the proper regulator of exchange-traded event contracts and that a patchwork of state enforcement undermines it. The strength of the competing readings will be tested in the briefing that follows.

Why tribal operators are watching

For tribes, the case is about more than sports betting. The Indian Gaming Regulatory Act channels Class III gaming through negotiated compacts, which is the foundation for exclusivity arrangements and revenue-sharing terms in many states. If event contracts offered through federally registered exchanges can reach customers on Indian lands outside that framework, tribal leaders argue, the economic premise of those compacts is at risk. Our analysis of prediction-market revenue erosion examines the numbers behind that concern, and the Legal Guide explains how IGRA and compacts fit together.

It is also true that tribal views are not uniform. Some tribes have chosen to partner with prediction-market operators, a split we have covered in our reporting on the divide in Indian Country. The attorneys general brief does not address tribes at all, and its arguments rest on state police powers and the text of federal derivatives law. That is part of what makes the convergence notable: states, tribes, a professional sports league and former architects of the statute are asking the Court for the same thing for overlapping but distinct reasons.

The next concrete marker is Monday's filing. Whatever Kalshi argues, the Court's decision on whether to hear the case will shape the legal ground on which tribal compacts, state licensing regimes and exchange-traded event contracts coexist for years to come.