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Kalshi is battling the Maryland Lottery and Gaming Control Commission in federal court. The company filed a temporary restraining order and preliminary injunction against the regulator back in April.
Now 27 federally recognised tribes and seven tribal organisations want to join the case. They filed an amicus brief on June 17 supporting Maryland’s position.
Kalshi isn’t happy about the tribal intervention. The company is asking the US District Court for the District of Maryland to reject their filing entirely.
The tribal groups argue that certain event contracts offered by Kalshi actually constitute sports wagering. They say this violates existing federal law.
Specifically, they claim Kalshi’s offerings run afoul of Commodity Futures Trading Commission prohibitions. The tribes also say it violates the Indian Gaming Regulatory Act.
This matters because tribes have exclusive rights to operate certain types of gambling in many areas. Sports betting falls under these protections in various jurisdictions.
Kalshi describes the tribal coalition as “out-of-state tribal interests with no clear stake” in whether the company must comply with Maryland gaming laws.
The company says the brief comes too late in the process. “If putative amici were permitted to file a brief at this late stage, Kalshi would have less than 48 hours before its supplemental response brief is due,” the company stated.
Kalshi also argues the brief wouldn’t help the court’s decision. The company says the tribes don’t have a direct interest in the Maryland-specific legal question at hand.
The dispute started when MLGCC issued cease-and-desist letters to Kalshi on April 7. Robinhood and North American Derivatives, which operates as Crypto.com, also received similar orders.
This Maryland case is just one part of Kalshi’s multi-state legal battles. The Nevada Resort Association was granted approval to intervene in Kalshi’s separate lawsuit against Nevada gaming regulators on June 4.
Kalshi says it’s been “accommodating of parties claiming an interest” in other cases. The company has consented to amicus briefs in a Third Circuit appeal that’s currently pending.
But the company is drawing the line here. Kalshi argues this particular brief is both “untimely and unhelpful” to the court’s decision-making process.
The outcome could set important precedents for how commodity trading platforms operate in states with sports betting regulations. It also tests the boundaries between federal commodity trading rules and state gaming laws.
This legal battle follows a recent court case between Kalshi and The Commodity and Futures Trading Commission (CFTC), where the commission requested permission from the US Court of Appeals for the District of Columbia Circuit to settle its legal dispute with Kalshi.
