The Nevada Supreme Court has denied Kalshi’s emergency motion and scheduled a contempt hearing, marking a significant procedural setback for the prediction market operator as state regulators move to enforce geofencing requirements that Kalshi has so far declined to implement.
The ruling follows a sequence of adverse federal and state decisions that have stripped away the procedural shields Kalshi secured in the early stages of this dispute. Chief Judge Andrew Gordon of the U.S. District Court for the District of Nevada had originally granted Kalshi a preliminary injunction in April 2025, blocking the Nevada Gaming Control Board and Commission from pursuing civil or criminal enforcement against the company on the basis that state gaming law was likely preempted by the Commodity Exchange Act. That injunction was subsequently dissolved, and Gordon denied Kalshi’s motion for a stay, leaving it exposed to state enforcement action.
Federal Denials Open the Door for State Action
On February 17, 2026, the U.S. Court of Appeals for the Ninth Circuit formally denied Kalshi’s emergency motion for an administrative stay. The Nevada Gaming Control Board responded swiftly, filing a civil enforcement action in state court seeking a temporary restraining order and preliminary injunction that would require Kalshi to geofence Nevada and halt sports event contract trading for Nevada-based customers. The Nevada Supreme Court’s denial of Kalshi’s latest emergency motion and the scheduling of a contempt hearing represent the next step in that enforcement escalation.
Sports betting attorney Daniel Wallach has noted on X that following the Ninth Circuit’s denial, Nevada regulators were positioned to move promptly on enforcement, and that Kalshi’s remaining federal option may be an emergency application to the U.S. Supreme Court’s emergency docket to preserve the status quo while broader appellate proceedings continue.
A Fractured National Picture
The Nevada proceedings are unfolding alongside sharply divergent outcomes in other jurisdictions. On February 19, 2026, the U.S. District Court for the Middle District of Tennessee granted Kalshi a preliminary injunction, finding its sports contracts are likely swaps under the CEA and that federal law likely preempts Tennessee’s enforcement effort – a direct vindication of Kalshi’s core legal theory. Massachusetts, by contrast, denied Kalshi a stay on February 6, 2026, requiring the company to either geofence the state by March 8 or continue up the state appellate ladder.
The Commodity Futures Trading Commission has entered the federal proceedings as amicus, asserting exclusive jurisdiction over event contracts traded on CFTC-designated markets – a position that directly conflicts with the enforcement postures of Nevada, Massachusetts, and other states pursuing action against Kalshi. As previously reported, Nevada’s contempt motion against Kalshi originated from the company’s continued operation in the state despite regulatory demands to geofence, and the Supreme Court denial now brings that contempt process to a formal hearing stage.
The pattern of multi-state enforcement is not limited to Nevada and Massachusetts. New Mexico Attorney General Raúl Torrez filed suit against Kalshi in June, alleging illegal sports betting operations in the state, adding further jurisdictional pressure on a company simultaneously contesting regulatory authority in multiple forums.
The contempt hearing will test how aggressively Nevada pursues enforcement against a federally designated market operator, and whether the prospect of sanctions compels Kalshi to geofence the state or accelerates its push for Supreme Court intervention. With Tennessee’s ruling pulling in one direction and Nevada, Massachusetts, and New Mexico pulling in another, the absence of a definitive federal appellate or Supreme Court ruling on CFTC preemption continues to shape – and complicate – Kalshi’s ability to operate nationally.
Petra Vanhoof has spent the better part of a decade following the shifting tides of gambling regulation across Europe and beyond. She came up through the compliance side of the industry before pivoting to writing, which gives her a grounded, no-nonsense perspective on the rules, loopholes, and political maneuvering that shape how operators actually do business. She is particularly drawn to the gap between what regulators say and what the market ends up doing in response.