Ninth Circuit rules a wager is a wager in blow to event-contract framing
The Ninth Circuit issued a ruling holding that a wager is a wager, rejecting the event-contract framing that prediction market platforms have used to distinguish their products from gambling. The decision conflicts with a Third Circuit ruling from April that found Kalshi's sports event contracts permissible. The split deepens a circuit divide that platforms, states, and at least three Supreme Court petitions now seek to resolve.
The Ninth Circuit's ruling strips the federal preemption shield from every CFTC-registered platform offering sports-linked contracts in that circuit's twelve western states. Kalshi and Crypto.com must now geofence or litigate state by state, while traders hold positions whose legality shifts at state borders.
The circuit split gives the Supreme Court a clear vehicle to intervene, with three pending petitions demanding uniform federal rules. A cert grant would freeze the fragmentation; a denial leaves platforms fighting fifty separate gaming commissions with precedent running against them in the nation's largest circuit. Each new state filing compounds faster than any single case can resolve.