US Appeals Court Rules Ohio and Tennessee Can Apply Gambling Laws to Kalshi Sports Contracts

The US Court of Appeals for the Sixth Circuit ruled on September 25 that Ohio and Tennessee may apply their state gambling laws to sports-related event contracts offered by the prediction market Kalshi. The court rejected Kalshi's argument that these contracts qualify as swaps under the Commodity Exchange Act (CEA) and are therefore subject to exclusive federal regulation by the CFTC. The ruling maintains the lower court's decision in Ohio and reverses a preliminary injunction in Tennessee, remanding both cases to lower courts. Tennessee Attorney General Jonathan Skrmetti welcomed the decision, citing the state's authority to regulate sports betting risks.