Three California tribes file suit against prediction markets Kalshi and Robinhood
The suit alleges that these sites are engaging in illegal sports betting
Sports betting in California is in violation of IGRA
Three California tribes have filed suit against prediction markets Kalshi and Robinhood. The legal action alleges that the prediction market sites are engaging in illegal sports gambling in California.
The three federally-recognized Indian Tribes serving as plaintiffs in the suit are the Blue Lake Rancheria, the Chicken Ranch Rancheria of Me-Wuk Indians, and the Picayune Rancheria of the Chukchansi Indians.
The suit, filed at the California Northern District Court, is seeking a preliminary and permanent injunction against the defendants designed to prohibit the sites from partaking in illegal sports gambling on the Tribes’ respective reservations. Lawyers for the tribes argue that doing so is in direct violation of the Indian Gaming Regulatory Act (IGRA).
Tribal gaming acts entered into in the state of California specifically prohibit sports betting of any kind taking place on tribal reservations or Indian lands.
Derivative trading company Robinhood formed a partnership with Kalshi to open a prediction market on the Robinhood investment platform. Both companies have headquarters in Delaware.
Up To $1500 in Bonus Bets Paid Back if your First Bet Does Not Win
Get bonus now
Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) 877-8-HOPENY or text HOPENY (467369) (NY) 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR). 21+ only. Please Gamble Responsibly. See BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable. In partnership with Kansas Crossing Casino and Hotel. Promotional offers not available in Mississippi, New York, Ontario, or Puerto Rico.
New DraftKings Customer: SPEND $5, GET $200 IN BONUSES
Get bonus now
To be eligible for DraftKings Sportsbook and the Promotion, you must be physically located in AR, AZ, CO, CT, DC, IA, IL, IN, KS, KY, LA (select parishes), MA, MD, ME, MI, MO, NC, NJ, NH, NY, OH, OR, PA, PR (residents only), TN, VA, VT, WY, WV, CA-ONT or CA-AB (each an “Eligible Jurisdiction” or, collectively, the “Eligible Jurisdictions”). Must be 21+ years of age or older (18+ if in DC/NH/PR/WY/CA-AB) (19+ in CA-ONT). GAMBLING PROBLEM? CALL 1-800-GAMBLER or 1-800-MY-RESET, (800) 327-5050 or visit gamblinghelplinema.org (MA) Please Gamble Responsibly. 888-789-7777/visit ccpg.org (CT), or visit www.mdgamblinghelp.org (MD), 1-800-981-0023 (PR). 21+ and present in most states. (18+ DC/NH/PR/WY). Void in CAN. Eligibility restrictions apply. On behalf of Boot Hill Casino (KS). Pass-thru of per wager tax may apply in IL. 1 per new DraftKings customer. $5+ first-time bet req. Max. $200 issued as non-withdrawable Bonus Bets. Stake removed from payout. Reward issued as $50 in Bonus Bets every 7 days via click-to-claim for 21 days. Bonus Bets and click-to-claims expire 7 days (168hrs) after issuance. Terms: Promos | DraftKings Sportsbook . Ends 9/20/26 at 11:59 PM ET. Sponsored by DK.
Prediction markets are operating in a grey area of gambling regulations
This lawsuit is just the latest salvo to be fired in what has been an ongoing battle of semantics between operators of prediction sites, state gambling regulatory bodies, and legal and regulated betting sites operating in the US market.
Regulators and operators of legal gambling sites insist that these prediction markets are nothing more than sports betting sites in disguise. These prediction market sites offer the counterargument that derivative trading in the prediction market is about traders setting a market. They insist that they are already being regulated as trading instruments.
All of the prediction markets in the US market currently operate under the regulation of the US Commodities Futures Trading Commission (CFTC).
Tribes are taking the offensive against prediction market sites
This strategy of going on the offensive is standard operating procedure for California's tribes when it comes to gambling regulatory matters. It's proving to be a very effective strategy.
In 2022, tribal gaming organizations lobbied heavily and successfully against Proposition 27. A referendum included as part of the 2022 US midterm elections, Proposition 27 asked California voters whether they wanted the state to legalize online sports betting to be run by state racetracks. It wound up suffering a sound defeat, with 82.18% voting against Proposition 27.
There is no legal and regulated online gambling in California. The state's tribes control land-based casino gambling, operating 69 brick-and-mortar casinos across the state. However, all of California’s poker rooms are under the control of commercial entities. Both sides are seeking to gain control of the lucrative online gambling industry in the largest state in the USA in terms of population. California is home to 38 million people.
In the 71-page claim against Kalshi and Robinhood, 25 pages argue a separate RICO allegation. The tribes argue that by bringing illegal online gambling across state lines, the companies are committing wire fraud.
None of the allegations has been proven in court.
The federal government remains on the fence regarding prediction markets
Following the 2024 Presidential election, the Trump administration was promising clarity in regards to the legality of prediction markets. Seven months later, all parties involved in this debate are still awaiting that clarity.
Caroline Pham is currently serving as the temporary commissioner of the FCTC. Brian Quintenz is under consideration by Congress to fill the vacancy on a full-time basis. Quintenz served as commissioner of the FCTC from 2017-21.
In the absence of federal oversight, expect these legal battles to continue to be fought at the state level. Previously, Kalshi won a temporary injunction in New Jersey preventing a ban on prediction markets in that state.
Up To $1500 in Bonus Bets Paid Back if your First Bet Does Not Win
USA Players Welcome
Bet now
Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) 877-8-HOPENY or text HOPENY (467369) (NY) 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR). 21+ only. Please Gamble Responsibly. See BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable. In partnership with Kansas Crossing Casino and Hotel. Promotional offers not available in Mississippi, New York, Ontario, or Puerto Rico.
New DraftKings Customer: SPEND $5, GET $200 IN BONUSES
USA Players Welcome
Bet now
To be eligible for DraftKings Sportsbook and the Promotion, you must be physically located in AR, AZ, CO, CT, DC, IA, IL, IN, KS, KY, LA (select parishes), MA, MD, ME, MI, MO, NC, NJ, NH, NY, OH, OR, PA, PR (residents only), TN, VA, VT, WY, WV, CA-ONT or CA-AB (each an “Eligible Jurisdiction” or, collectively, the “Eligible Jurisdictions”). Must be 21+ years of age or older (18+ if in DC/NH/PR/WY/CA-AB) (19+ in CA-ONT). GAMBLING PROBLEM? CALL 1-800-GAMBLER or 1-800-MY-RESET, (800) 327-5050 or visit gamblinghelplinema.org (MA) Please Gamble Responsibly. 888-789-7777/visit ccpg.org (CT), or visit www.mdgamblinghelp.org (MD), 1-800-981-0023 (PR). 21+ and present in most states. (18+ DC/NH/PR/WY). Void in CAN. Eligibility restrictions apply. On behalf of Boot Hill Casino (KS). Pass-thru of per wager tax may apply in IL. 1 per new DraftKings customer. $5+ first-time bet req. Max. $200 issued as non-withdrawable Bonus Bets. Stake removed from payout. Reward issued as $50 in Bonus Bets every 7 days via click-to-claim for 21 days. Bonus Bets and click-to-claims expire 7 days (168hrs) after issuance. Terms: Promos | DraftKings Sportsbook . Ends 9/20/26 at 11:59 PM ET. Sponsored by DK.
Must be 21+. GAMBLING PROBLEM? CALL 1-800-GAMBLER OR CALL 1-800-MY-RESET, www.mdgamblinghelp.org (MD), (800)-327-5050 or gamblinghelplinema.org (MA), Call (877)8-HOPENY or text HOPENY (467369) (NY), (888) 789-7777 or ccpg.org (CT), morethanagame.nc.gov (NC), 1800gambler.net (WV)
21+ and present in OH. Gambling Problem? Call 1-800-GAMBLER.
This site is using
Cloudflare
and adheres to the
Google Safe Browsing Program. We adapted
Google's Privacy Guidelines
to keep your data safe at all times.
BetMGM Sports Promo
Up To $1500 in Bonus Bets Paid Back if your First Bet Does Not Win
Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) 877-8-HOPENY or text HOPENY (467369) (NY) 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR). 21+ only. Please Gamble Responsibly. See BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable. In partnership with Kansas Crossing Casino and Hotel. Promotional offers not available in Mississippi, New York, Ontario, or Puerto Rico.
Daily picks from betting experts on odds boosts and casino promos
