Gaming regulators ask the US Supreme Court to hear New Jersey’s Kalshi case

On 2 October 2026, the International Association of Gaming Regulators (IAGR) and the North American Gaming Regulators Association (NAGRA) filed a joint amicus brief asking the US Supreme Court to take New Jersey’s case against Kalshi, Flaherty v. KalshiEX. New Jersey filed its petition in September. The regulators want the Court to decide whether sports event contracts escape state gambling law.

What the regulators argue

IAGR, whose president is Ben Haden, filed the brief with NAGRA in support of New Jersey’s petition. NCLGS filed the first amicus brief in the case on 22 September 2026.

The core argument is narrow. The Commodity Exchange Act does not exempt a sports wager from state gambling law just because a CFTC-registered exchange lists it as an event contract.

The brief cites state rules on licensing, event and wager approval, integrity monitoring, age limits, self-exclusion and enforcement in Ohio, Illinois, Massachusetts, Tennessee, Nevada, New Jersey and Colorado. Without that oversight, the regulators say, they cannot detect manipulation of the underlying events, and minors and problem gamblers lose protections.

A split between the appeals courts

Federal appeals courts disagree. In April 2026 the Third Circuit sided with Kalshi against New Jersey. It found the contracts are likely swaps and that federal law likely preempts state law.

On 28 August 2026 the Ninth Circuit held that Nevada gaming law applies, at the preliminary relief stage only. On 25 September 2026 the Sixth Circuit upheld the denial of Kalshi’s injunction in Ohio and vacated one in Tennessee. It said the Act would not preempt state law even if the contracts were swaps.

The Fourth Circuit heard Maryland’s case in May 2026 and has not ruled; a New York appeal sits at the Second Circuit. Robinhood and Crypto.com have asked the Supreme Court to review their Ninth Circuit loss to Nevada. Kalshi has not filed its own petition; it asked the full Ninth Circuit for a rehearing.

June 2027 at the earliest

The Court has given no indication that it will hear the matter. Analyst Daniel Wallach’s quickest scenario: review granted in December 2026 or January 2027, arguments in March or April, and a decision by June 2027.

That schedule leaves little slack. If the Court has not accepted a case by early 2027, Wallach expects a ruling not before 2028. He puts the chance that the states prevail at 70–80%.

Meanwhile, the CFTC is rewriting its event-contract rules. Tribal gaming adds another layer: sports betting is Class III gaming under IGRA, and in September 2026 the Ninth Circuit found tribes likely to succeed on claims that unauthorised sports contracts on their lands violate it.

What it means for operators and suppliers

Until the Court rules, prediction-market sports contracts sit in a legal grey zone that differs by circuit. A product that holds up in one region may be challenged under state law in another.

Licensed sportsbooks keep the advantages the regulators describe. They already work under state licensing, event and wager approval, integrity monitoring, age limits and self-exclusion. In this dispute those controls are the regulators’ main evidence, so operators and suppliers should be able to show them working.

For background, see our July explainer on prediction markets and sportsbooks and our overview of the US iGaming market.

Based on Yogonet (8 October 2026). This is a summary, not legal advice.