Ninth Circuit affirms Montana judge's denial of Kalshi preliminary injunction
A Ninth Circuit panel ruled against Kalshi on August 28, affirming that a Montana federal judge did not abuse discretion in dissolving a preliminary injunction. The panel found Kalshi failed to show a likelihood of success on the merits. Separately, the Montana judge denied Kalshi's motion for a preliminary injunction and admonished both sides for requesting a third stay without explanation. The twin rulings deepen Kalshi's legal setbacks in the state.
Kalshi now lacks injunctive protection in Montana while the underlying case proceeds. The Ninth Circuit joins state courts in Connecticut, Washington, Michigan, Wisconsin, New York, and Utah in rejecting its federal preemption argument. Traders hold sports event contracts whose validity shifts with state borders. Rivals Polymarket and Novig face identical exposure, but Kalshi's prominence makes it the test case attorneys general target first.
Each loss forces Kalshi toward costly state-by-state geofences or voided contracts. Legal spend compounds across parallel dockets while the platform's national sports market fragments. The circuit split with the Third Circuit offers a path to Supreme Court review, but that timeline stretches years. A geofence cascade could fragment Kalshi's market before any high-court ruling lands.
The Ninth Circuit panel's denial extends Kalshi's losing streak across federal and state courts to at least eight jurisdictions, after parallel rejections of its preemption defense in Connecticut, Washington, Michigan, Wisconsin, New York, and Utah.