Arizona AG Mayes asks 9th Circuit to lift injunction blocking Kalshi gambling case
Arizona Attorney General Kris Mayes is asking the 9th Circuit Court of Appeals to dissolve an injunction that has blocked the state's gambling case against Kalshi. The filing follows a recent ruling by the same court. Mayes is seeking to revive litigation targeting Kalshi's operations in Arizona. The case is part of a broader pattern of state enforcement against CFTC-registered prediction market platforms. Kalshi has argued federal preemption shields it from state gambling laws.
Kalshi's federal preemption defense is now under direct attack in three circuits simultaneously, stripping away the shield that kept state gambling laws at bay. Each new state attorney general who files before the Supreme Court acts deepens the legal patchwork and fragments liquidity across borders. Kalshi must burn resources on parallel defenses in Arizona, Ohio, Tennessee, and tribal lands instead of one clean federal resolution.
Traders hold positions whose validity shifts with geography, not regulation. The platform that loses the first federal preemption ruling becomes the template every other state copies for shutdown letters. Legal spend compounds faster than any single case resolves, and development dollars divert to geofencing and compliance. Kalshi's path to uniform rules now runs only through the Supreme Court, where cert consideration takes months.
Marks the third appellate setback this month for prediction-market platforms asserting federal preemption, after the Circuit blocked Kalshi sports contracts on two California tribal lands and the Sixth Circuit let Ohio and Tennessee enforce gambling laws.