A three‑judge panel of the Ninth Circuit heard oral arguments on Friday concerning whether Kalshi Inc. and Robinhood Markets may continue offering sports‑event contracts to users located on tribal lands while a related lawsuit proceeds.
The dispute originates from a district‑court decision that denied a preliminary injunction sought by three California tribes—Blue Lake Rancheria, Chicken Ranch Rancheria and Picayune Rancheria—who allege the contracts constitute prohibited gaming under federal law.
Representing the tribes, attorney Lester Marston contended that any contract entered into from tribal land automatically becomes Class III gaming under the Indian Gaming Regulatory Act, regardless of its form elsewhere.
Marston illustrated a typical scenario: a resident of Blue Lake Rancheria downloads the Kalshi app, places a wager on a sports outcome, and receives a payout contingent on the game’s result.
A judge highlighted the minimal practical distinction between Kalshi’s product and a conventional sportsbook, noting that Kalshi counsel admitted the same transaction would be barred through a rival platform but permitted through Kalshi.
Marston argued that the legal status of the activity shifts the moment it occurs on reservation territory, citing Supreme Court precedent that conduct lawful off‑reservation can become unlawful on tribal land.
He further asserted that tribal gaming ordinances, tribal‑state compacts, and the Indian Gaming Regulatory Act function as a unified regulatory framework, so a violation of an ordinance also breaches the compact.
Kalshi’s attorney, Grant Mainland, urged the panel to limit the appeal, maintaining that the tribes lack standing under the cited provision because it authorizes claims only for violations of a tribal‑state compact, and no such violation is evident.
Mainland also emphasized that tribal ordinances are legally distinct from compacts and that the tribes never pursued preliminary relief on that basis; when asked directly, he affirmed that Kalshi’s contracts are not Class III gaming.
Robinhood’s counsel, Anthony Ryan, focused on the injunction standard, arguing that the tribes have not demonstrated irreparable harm or customer diversion, and therefore have not met the threshold for preliminary relief.
The panel concluded the arguments without issuing an immediate ruling, taking the case under submission for further consideration.
