Kalshi Seeks to Dismiss Ho-Chunk Nation’s Federal Sports Betting Lawsuit
Ho-Chunk Nation Challenges Kalshi and Robinhood in Federal Court
A legal dispute is unfolding in federal court as the Ho-Chunk Nation files a lawsuit against Kalshi, a prediction-market platform, and its distribution partner Robinhood. The tribe alleges that these companies are operating illegal gambling activities that infringe upon tribal sovereignty.
Tribal Sovereignty and Illegal Gambling Claims
The Ho-Chunk Nation asserts that Kalshi and Robinhood have established an unauthorized online sports betting platform accessible to users nationwide, including those on tribal reservations. According to the tribe, the event-based contracts offered by Kalshi closely resemble traditional sports betting. This, they argue, violates the Indian Gaming Regulatory Act (IGRA) and conflicts with the tribe’s compact with the state of Wisconsin. The lawsuit emphasizes the impact of Kalshi’s rapid growth and widespread advertising, which the tribe believes undermines their established regulatory authority.
Kalshi Seeks Dismissal of the Lawsuit
In response, Kalshi has requested the court to dismiss the lawsuit. The company argues that the Ho-Chunk Nation lacks standing to sue under IGRA because Kalshi is not a party to the tribal-state compact. Kalshi’s legal team filed this motion on November 21, aiming to prevent the case from moving forward.
Reference to California Court Decision
Kalshi cited a recent ruling in California where a federal judge declined to halt the company’s operations despite similar challenges from three tribes. The company contends that Wisconsin’s case repeats the same flawed premise that tribes can enforce their compacts on businesses located outside reservation lands.
Legal Arguments and Jurisdictional Issues
Kalshi maintains that under IGRA, tribes can only sue if specific terms of a compact are violated, which the Ho-Chunk Nation has not demonstrated. The company argues that a belief that Kalshi’s contracts are prohibited does not grant the tribe the authority to file a lawsuit. Instead, Kalshi suggests that any federal government concerns should be addressed through appropriate regulatory channels.
Regulatory Oversight and Contract Distinctions
Kalshi underscores that its platform operates under the Commodity Exchange Act and is regulated by the Commodity Futures Trading Commission, distinguishing its contracts from conventional gambling. The company also points out that its principal locations of business are New York and Delaware, not the users’ locations where the betting may take place.
Next Steps and Related Legal Battles
The Ho-Chunk Nation must file a response to Kalshi’s dismissal request by December 19. Following this, Judge William Conley will decide whether the lawsuit will proceed. This Wisconsin case is part of a broader wave of legal challenges facing Kalshi, involving similar suits in Nevada, New Jersey, Massachusetts, and Maryland. These ongoing cases are shaping how federal law applies to emerging prediction market platforms.
