Nevada Court Denies Kalshi’s Motion to Stay Discovery

A Nevada federal magistrate has denied Kalshi’s request to stay discovery in its dispute with state regulators, ordering fact development to proceed.

In the order, the court ruled that discovery cannot be limited to the pending summary judgment issues. It stated that “the discovery needed to oppose the motion for summary judgment is coextensive with the discovery required to defend the case,” according to excerpts posted by gaming attorney Daniel Wallach on X.

The ruling also confirmed that defendants, including Nevada regulators and the Nevada Resort Association, may probe whether “eliminating contracts in Nevada would risk and/or facilitate market manipulation and [whether] the Core principles Kalshi maintains would be violated should it attempt to comply with the cease-and-desist letter.”

In another passage, the judge noted that “Defendants should not be forced to accept Plaintiff’s conclusion that contracts offered on its DCM have independent real-world consequences and thus, fall under the exclusive jurisdiction of the CFTC.”

The order further stated that, “given Kalshi’s ability to self-certify contracts, Defendants should not be required to accept as a fait accompli that ‘the CFTC has taken no action to bar Kalshi’s contract on the grounds that they are not swaps.'”

The court ordered the parties to submit a proposed protective order within 10 days of the ruling.

Earlier Nevada Injunction

The ruling contrasts with Kalshi’s victory in April. Then, a Nevada federal judge granted the platform a preliminary injunction preventing state regulators from shutting it down.

In that case, the court agreed Kalshi had demonstrated a likelihood of success on the claims that the CFTC and Commodity Exchange Act (CEA) preempt state gambling laws regarding designated contract markets. The ruling allowed Kalshi to continue offering event contracts in Nevada while litigation plays out.

In the same month, the company scored another win. A New Jersey federal judge also granted it a temporary injunction against the state regulator.

Maryland Setback and Temporary Agreement

While Kalshi gained momentum with the April rulings in Nevada and New Jersey, it suffered its first setback in August in Maryland.

There, a federal judge denied the company’s injunction requests, rejecting its claims that the CEA preempts state gambling laws. The judge concluded that the state has broad authority to regulate gambling.

Still, Kalshi and Maryland regulators reached a temporary agreement. That paused Maryland’s enforcement of its cease-and-desist order until the U.S. Court of Appeals for the Fourth Circuit decides the case. That could extend the dispute into the fall.

Football Market Expansion Amid Legal Uncertainty

Despite ongoing litigation in multiple states, Kalshi continues to expand its sports markets. In August, it self-certified to offer point spreads, totals, and touchdown prop betting. Meanwhile, this week, it self-certified to offer parlays-style markets.

Under US futures law, exchanges can self-certify new products without prior approval from the CFTC. That allows Kalshi to expand without waiting on the CFTC’s approval or other action.

As the NFL season is about to begin, indications from college football’s first weekend suggest that the platform could experience significant growth.

On the first Saturday of the college football season, Kalshi recorded $87 million in trading volume. That marked its busiest day since the 2024 elections. Users traded nearly $63 million on college football outcomes alone.