Kalshi asks full Sixth Circuit to rehear its Ohio/Tennessee loss

Kalshi seeks another review

Kalshi has asked the full Sixth Circuit to reconsider a three-judge panel’s decision allowing Ohio and Tennessee to pursue regulatory action over its offering of unlicensed online sports gambling, according to Bloomberg Law.

In an Oct. 9 filing with the Cincinnati-based court, Kalshi argued that the panel wrongly allowed states to impose penalties on it and other prediction-market platforms. The request seeks further review of a ruling that permits state gambling enforcement against its sports-event contracts.

Federal proposal supports Kalshi’s argument

Kalshi pointed to proposed rules released on Oct. 9 by the Commodity Futures Trading Commission as support for its position, Bloomberg Law reported. The proposal would further define “swaps” to encompass event contracts covering sports, politics and other occurrences.

The dispute concerns the reach of state gambling laws over those contracts and their treatment under federal commodities regulation. The available reporting describes both a request for rehearing and a proposed federal rule—not a decision by the full Sixth Circuit or a finalized regulatory change.

What it means for prediction markets

• State enforcement remains central: The panel’s ruling allows Ohio and Tennessee to take regulatory action against Kalshi over its sports offerings; Kalshi is seeking to have that ruling reconsidered.
• Federal definitions are part of the challenge: Kalshi argues that the CFTC’s proposed treatment of event contracts as swaps strengthens its case against state penalties.
• Two developments warrant attention: Whether the full Sixth Circuit grants review and how the CFTC proposal proceeds are distinct questions. Neither outcome is established in the available report.