The Second Circuit denied protection pending appeal in New York and Connecticut; the Ninth Circuit separately denied rehearing in Nevada, leaving a ruling against Kalshi in place.
The US Court of Appeals for the Second Circuit on 3 November 2026 rejected Kalshi’s requests to block New York and Connecticut from enforcing their gambling laws while the prediction-market operator appeals. The decision denied temporary protection; it did not finally decide the underlying appeals.
On 4 November 2026, the Ninth Circuit denied both a panel rehearing and a rehearing by the full court in Kalshi’s Nevada case, Ars Technica said. That left in place its August ruling allowing Nevada to stop Kalshi’s sports betting. The court said no judge had requested a vote on a full-court rehearing.
The Second Circuit decision followed federal district judges’ refusals to grant preliminary injunctions against enforcement in New York and Connecticut. Those judges found Kalshi had not shown it was likely to succeed on the merits. The appeals panel said the applicants had not made the showing required for an injunction pending appeal; its order gave no further detail about that showing.
Kalshi offers contracts tied to sports events and argues they are swaps governed exclusively by the federal Commodity Futures Trading Commission. A swap is a contract whose payment can depend on whether an event occurs. New York and Connecticut argue that the contracts are sports bets subject to state gambling laws.
Federal appeals courts have reached different conclusions. In April, the Third Circuit ruled that New Jersey could not regulate Kalshi’s sports contracts because they were swaps traded on a federally licensed market, placing them under the commission’s exclusive jurisdiction. In August, the Ninth Circuit found that Kalshi’s sports bets were not swaps and could be regulated by Nevada. In September, the Sixth Circuit ruled that Ohio and Tennessee could enforce their gambling laws against Kalshi.
Zagorka Dolovac issued the binding instruction on 29 October after reports and video suggested documents may have been removed or destroyed during the political transition.
Analysis
New York seeks to stop Kalshi from offering sports contracts without a gaming license and is seeking financial remedies, including restitution to customers. Connecticut seeks to stop the company offering the contracts to residents. Sports betting attorney Daniel Wallach told Legal Sports Report that the states still needed orders returning their enforcement lawsuits to state courts and preliminary injunctions to block the contracts.
New Jersey has asked the US Supreme Court to reverse the Third Circuit ruling. A brief filed by 39 other states and the District of Columbia supports its request.
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