Appeals Court Denies Kalshi Stay, Allowing Nevada to Pursue Temporary Restraining Order
Photo by Wesley Tingey on Unsplash
Kalshi has suffered another setback in its ongoing legal battle with Nevada, after the U.S. Court of Appeals for the 9th Circuit denied the company’s emergency motion for an administrative stay.
The March 19 ruling clears the way for Nevada regulators to seek a temporary restraining order (TRO) requiring Kalshi to geofence the state.
Editor’s note: The TRO was granted today.
Federal Appeal Fails to Block State Action
Kalshi filed an emergency motion for an administrative stay pending appeal of a March 2 federal court order that sent the case back to the Nevada state court. By denying that request, the 9th Circuit effectively removed the company’s immediate federal shield.
The decision allows the Nevada Gaming Control Board to pursue enforcement through state courts. The regulator has applied for an immediate TRO, which the court could grant as soon as today.
If issued, the TRO would prohibit Kalshi from operating in Nevada without a state license for at least 14 days, pending a preliminary injunction hearing. The state has already issued a TRO against platforms including Robinhood, Crypto.com, and Polymarket.
The 9th Circuit has scheduled oral arguments for Kalshi, Robinhood, and Crypto.com for April 16.
Background on Nevada vs. Kalshi
The legal battle between Nevada and Kalshi began in March 2025, when the state issued a cease-and-desist order to the operator.
Kalshi sued, arguing that its event contracts fall under the Commodity Futures Trading Commission’s (CFTC) federal oversight. The company initially won a preliminary injunction in April, when U.S. District Judge Andrew Gordon found that the Commodity Exchange Act likely preempts state gaming laws.
The court, however, reversed that decision in November 2025 and dissolved the injunction. As part of the decision, Judge Gordon referenced Kalshi’s expansion into prop-style sports markets. He concluded that Nevada’s interests in regulating gaming outweigh any harm to Kalshi.
Kalshi appealed to the 9th Circuit in February. The appeals court denied Kalshi’s emergency motion for an administrative stay, and within hours, Nevada filed a new civil enforcement action.
The prediction market operator then moved the enforcement case to federal court. However, on March 2, a federal judge remanded the case to state court, rejecting Kalshi’s preemption arguments.
What Comes Next
The focus now shifts to the Nevada state court, which could issue a TRO as early as today, prompting Kalshi to exit Nevada at least temporarily.
That could be significant because it may weaken Kalshi’s argument in other jurisdictions that implementing geolocation technology would constitute “irreparable harm,” a key claim in its ongoing preemption litigation.
On April 16, the court will hear Kalshi’s arguments on the preliminary injunction. Any decision there could significantly shape litigation elsewhere.
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