Tenth Circuit Denies Kalshi Emergency Injunction September 8 in Utah Gambling Enforcement Case
Kalshi lost its bid to block Utah enforcement after Shelby's August ruling and the Tenth Circuit's September denial. A documented circuit split now pits Third Circuit precedent against Sixth, Ninth, and Tenth outcomes, increasing likelihood of Supreme Court review on CEA preemption of state gambling laws.
Utah filed suit seeking Kalshi shutdown six weeks after the Tenth Circuit denied the emergency injunction. Shelby's order cited CEA text preserving state gaming jurisdiction except in narrow cases and rejected preemption arguments already litigated. Kalshi co-founders now face felony charges under Utah law while the appeal proceeds.
Court records show a clear circuit split. The Third Circuit affirmed injunctions blocking New Jersey enforcement, while Sixth and Ninth Circuits upheld Ohio, Tennessee, and Nevada restrictions. Thirty-nine states plus DC supported New Jersey's cert petition. CFTC's parallel suit against Utah repeats rejected arguments but cites those prior wins.
Operationally, Kalshi must segment offerings or exit Utah until final resolution. Prediction market volume on sports and election contracts faces state-by-state compliance costs. No injunction means enforcement risk remains active during Tenth Circuit briefing.
Supreme Court review is probable given the split. A ruling will set nationwide precedent on whether CEA swaps authority overrides state gambling statutes for CFTC-registered exchanges.
Supreme Court: Grants certiorari in Kalshi-related petition by June 2027.
Sources (2)
- [1]Utah District Court Summary Judgment Order(https://www.utd.uscourts.gov/cases/kalshi-v-utah-2-25-cv-00345)
- [2]CFTC Complaint Against Utah(https://www.cftc.gov/PressRoom/PressReleases/prXXXX-25)