Kalshi fends off tribal lawsuit as VC backing grows amid sports betting legal battles
Kalshi has just fended off a legal challenge from three California tribes, allowing the prediction market platform to continue offering sports-event contracts.
Summary
- A federal judge has denied a preliminary injunction sought by three tribes, allowing KalshiEX LLC to continue offering sports-event contracts on tribal lands.
- Kalshi has recently filed a federal lawsuit against New York regulators after a cease-and-desist order, asserting that its contracts fall under federal CFTC oversight rather than state gambling law.
- Despite legal pressures in multiple states, Kalshi continues to attract significant VC capital. Its valuations are now estimated between $10 billion and $12 billion.
Kalshi Inc., a U.S.-based prediction market platform, has successfully fended off a preliminary injunction sought by three California tribes that aimed to halt the company’s sports-event contracts on tribal lands, Bloomberg Law reported Tuesday.
The lawsuit was filed by the Blue Lake Rancheria, the Chicken Ranch Rancheria of Me-Wuk Indians, and the Picayune Rancheria of the Chukchansi Indians. The tribes argued that Kalshi’s contracts constituted unlawful gaming under the Indian Gaming Regulatory Act, claiming that the company’s marketing statements misrepresented the legality of sports betting.
U.S. District Judge Jacqueline Scott Corley denied the tribes’ motion on Monday, ruling that they had not demonstrated a likelihood of success on the merits of their claims. The decision allows KalshiEX LLC, an affiliate of Kalshi, to continue offering and advertising sports-event contracts on tribal lands for the time being.
Kalshi continues to attract VC backing amid ongoing legal disputes
Kalshi is also facing legal pressure in New York, where state regulators issued a cease-and-desist order, arguing that its sports-event contracts constitute unlicensed gambling. In response, the company has recently filed a federal lawsuit seeking to block enforcement, claiming that its markets fall under federal CFTC oversight rather than state gambling law.
Despite these regulatory challenges across multiple states, investors have continued to back Kalshi’s platform. The company recently raised $300 million in a funding round led by Andreessen Horowitz and Sequoia Capital, following an earlier $185 million raise. Current discussions suggest Kalshi’s valuation could now be between $10 and $12 billion, signaling strong VC confidence in its long-term growth.
