Kalshi vs Nevada: Prediction Market Battle Heads To Ninth Circuit

Kalshi has escalated its fight with Nevada regulators, filing an emergency motion with the United States Court of Appeals for the Ninth Circuit in an effort to stop what it says is an imminent civil enforcement action. The move adds another layer to an already tense standoff between the federally regulated prediction market platform and one of the country’s most established gambling jurisdictions.

The filing, submitted February 11, 2026, seeks an administrative stay while the broader appeal plays out. Kalshi argues that Nevada officials have threatened to initiate civil enforcement proceedings despite what the company describes as a prior agreement to hold off while a stay motion was pending.

Kalshi Files Emergency Motion With 9th Circuit

The case, styled KalshiEX LLC v. Kirk D. Hendrick et al., is now before the Ninth Circuit under case number 25-7516. In its emergency motion, Kalshi requests relief under Circuit Rule 27-3, stating that immediate intervention is required by February 16, 2026.

At issue is whether Nevada can move forward with civil enforcement while Kalshi’s appeal is still active. The company contends that allowing the state to proceed would effectively undermine the purpose of the stay and create irreversible harm before the appellate court has ruled.

This is not a minor procedural step. An administrative stay would temporarily block Nevada from acting, preserving the status quo while the Ninth Circuit reviews the underlying dispute.

Kalshi vs Nevada Gaming Control Board Dispute Explained

The core conflict centers on Kalshi’s federally approved prediction markets and whether state regulators can treat certain contracts as illegal sports betting under Nevada law.

Nevada has historically guarded its authority over wagering inside state lines. Kalshi, on the other hand, operates under federal oversight through the Commodity Futures Trading Commission framework. That tension has become a flashpoint as prediction markets expand into event-based contracts that resemble traditional betting products.

Kalshi claims Nevada “reneged” on an understanding not to initiate civil proceedings while a stay motion was pending. If true, that allegation shifts the narrative from a standard jurisdictional disagreement to a procedural fairness argument.

The state has not publicly conceded that characterization, but the timing of the emergency filing suggests that Kalshi believes enforcement action is imminent.

What An Administrative Stay Means For Kalshi

An administrative stay does not decide the merits of the case. It simply pauses enforcement. For Kalshi, that pause could be critical.

Without a stay, Nevada could pursue penalties, licensing actions, or other civil remedies. Even if Kalshi ultimately prevails on appeal, the short-term disruption could affect operations, partnerships, and market confidence.

For Nevada regulators, opposing the stay would signal confidence in their legal footing and their authority to regulate products they view as functionally equivalent to sports wagering.

The Ninth Circuit now faces a narrow but urgent question: should it freeze state action while the appeal proceeds?

Ninth Circuit Court Of Appeals Case 25-7516

The appeal stems from proceedings in the United States District Court for the District of Nevada. Kalshi is listed as plaintiff-appellant, with Kirk D. Hendrick and other Nevada officials named as defendants-appellees.

The emergency motion was filed by a legal team that includes counsel from Milbank LLP and Las Vegas-based attorneys. The requested relief date of February 16 signals that the company expects a rapid response.

Appellate courts typically grant administrative stays only when a party demonstrates urgency and a likelihood of irreparable harm. The language in Kalshi’s motion indicates it believes both standards are met.

Prediction Markets vs State Sports Betting Laws

This dispute sits at the intersection of federal derivatives regulation and state gambling control. That gray area has grown more complex as prediction markets begin offering contracts tied to political events, economic data, and in some cases outcomes that resemble sports or entertainment wagering.

Nevada has built its regulatory identity around being the nation’s most experienced sports betting jurisdiction. Allowing federally regulated exchanges to operate similar markets without state licensure could be seen as a direct challenge to that framework.

Kalshi, by contrast, argues that its contracts are lawful under federal commodities law and should not be subject to patchwork state-by-state enforcement.

The Ninth Circuit’s handling of this emergency request could provide an early signal about how appellate courts view that balance of power.

What Happens Next In The Kalshi Nevada Case

The immediate next step is a ruling on the administrative stay. If granted, Nevada would be temporarily blocked from pursuing civil enforcement while the appeal continues.

If denied, the state could move forward, potentially increasing pressure on Kalshi’s operations within Nevada.

Either way, the broader legal battle over prediction markets and state gambling authority is unlikely to end here. The outcome could shape how similar platforms operate across the country, particularly in states with mature sports betting industries.

For now, the fight has shifted to the Ninth Circuit, and the clock is ticking toward mid-February.

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