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Sixth Circuit decision denying Kalshi appeal sets clearest stage for US, Supreme Court review yet

Derek Helling

Legal Writer

Publish Date: Apr 27, 2026

Fact checked by: Matt Moreno

Key Points

The U.S. Sixth Circuit Court of Appeals denied Kalshi’s request for a stay pending appeal of its lawsuit against Ohio.
Ohio gaming regulators have already issued a recommendation for a $5 million fine against Kalshi.
The language of the Sixth’s decision reads unfavorably for Kalshi, which could put the Sixth at odds with another federal appellate court.

The United States Sixth Circuit Court of Appeals continued Ohio’s string of court victories over Kalshi on Friday, rejecting Kalshi’s plea for temporary injunctive relief against potentially forthcoming penalties from the state. While the panel of judges from the Sixth did order Kalshi’s appeal of the case to be expedited, the language of the order doesn’t create a lot of room for optimism for Kalshi in those proceedings.

If the stay denial proves predictive of the Sixth’s position on Kalshi’s lawsuit against Ohio, that could set the court at odds with other federal appellate courts. For those reasons, the path to the U.S. Supreme Court in regard to the dispute over the classification of prediction markets and state sovereignty has never been clearer.

Photographer: Gabby Jones/Bloomberg via Getty Images

Sixth circuit rejects Kalshi’s plea for injunctive relief

After the federal court for the Southern District of Ohio declined to enjoin Ohio gaming regulators and law enforcement against taking action against Kalshi on the basis of alleged violations of the state’s gambling laws, a three-member panel of the Sixth Circuit upheld that ruling on Friday. The April 24 order did produce a pyrrhic victory for Kalshi, though.

In the order, the panel ordered the clerk to expedite the process of Kalshi’s appeal of the case. That’s a silver lining for Kalshi, though, as it acts to support the Sixth’s rejection of Kalshi’s petition for a stay.

Kalshi had asked the court to enjoin the defendants against enforcement actions for the duration of its appeal. The panel responded by stating that Kalshi had failed to state a strong enough case to necessitate that relief given the short timetable of the appeal.

The lack of injunctive relief for Kalshi means that Ohio Attorney General David Yost technically can proceed with levying the $5 million fine that the Ohio Casino Control Commission recommended if he so chooses. Yost might opt to take additional or different action against Kalshi and/or other prediction market operators, too.

Yost may also wait for Kalshi’s lawsuit against the Commission and others to play out at the federal district court. Regardless of how Yost proceeds, the language of the order that the panel from the Sixth suggests that it’s a friendly venue for Ohio’s interests.

Panel’s opinion sets up potential conflict with other circuits

Friday’s ruling out of the Sixth merely pertained to the issue of whether Kalshi’s request for a stay pending appeal was proper. The opinion came from just three members of the court.

However, it was also potentially the strongest rejection to date of Kalshi’s claims that its prediction markets are “swaps” that can only be regulated by the federal government and that actions like those that Ohio could take in the near future violate U.S. law. Some of the text in the order stated the skepticism over those arguments plainly.

For example, the ruling states that, “we therefore must begin with the presumption that Congress did not mean to preempt ‘Ohio’s historic police powers’ unless the Commodities Exchange Act discloses that as ‘the clear and manifest purpose of Congress.’” In that statement, the panel essentially said that it will assume that federal law does not preempt Ohio from enforcing gaming laws, but rather that the federal statute must explicitly compel such preemption.

The Sixth and Third Circuit Court of Appeals Could End Up At Odds

That presumption, if carried through to the full court’s decision on the merits of Kalshi v. Schuler et al., could set the Sixth at odds with the Third Circuit Court of Appeals. The Third has upheld a lower court ruling leaving an injunction against enforcement actions in New Jersey in place.

In that order, the court’s language was amenable to the preemption arguments. Decisions from the full courts on the merits of the cases could resolve similarly, but the preliminary action seems to set up a circuit split on the important questions of what prediction markets are under the law and to what extent, if at all, states can exercise sovereignty over trading going on within their borders.

A circuit split is a strong precedent for the U.S. Supreme Court reviewing a case. With the Sixth’s order from Friday, the path to that possibility has never been clearer.

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