Buena Vista Rancheria joins California tribes’ Kalshi lawsuit

A federal judge in California has allowed Buena Vista Rancheria of Me-Wuk Indians to join the tribes challenging Kalshi and Robinhood over sports event contracts accessible from tribal lands. The ruling adds Buena Vista as a plaintiff alongside Blue Lake Rancheria and Chicken Ranch Rancheria of Me-Wuk Indians in Blue Lake Rancheria v. Kalshi Inc.

Judge Jacqueline Scott Corley granted the request after the defendants, which had initially opposed Buena Vista’s entry, withdrew that opposition following the Ninth Circuit’s decision in the case. Buena Vista had moved to join on Aug. 14, according to the parties’ joint status report.

The court also directed the parties to meet and confer on a potential geofencing agreement that would remain in force until a further court order. It granted the plaintiffs permission to amend their complaint to add Buena Vista and approved their anticipated further amendment.

Kalshi told the court that it had worked with GeoComply to block people located on the plaintiff tribes’ lands from trading sports event contracts through its app and website. It argued that those measures made the tribes’ preliminary-injunction request moot.

The tribes disputed the practical effectiveness of the controls. Their status report said a member of the Blue Lake Rancheria Gaming Commission had been able to place a trade through the Kalshi app while on Blue Lake Rancheria after Kalshi said geofencing had been put in place. The tribes sought a court-supervised process to independently verify whether their reservations were being geofenced.

The next amendment is expected to add allegations against Robinhood. The tribes said they had obtained evidence that futures commission merchants such as Robinhood were central to the operation of a designated contract market such as Kalshi, rather than serving only as brokers. They intend to allege that Robinhood offered sports event contracts on their reservations in breach of the Indian Gaming Regulatory Act, tribal gaming ordinances, and tribal compact or procedures; Robinhood is expected to oppose the amendment.

As we reported in September, the Ninth Circuit found the tribes were likely to prevail on their argument that sports contracts entered from tribal territory constitute unlawful Class III gaming on Indian lands, and returned the injunction question to the district court for further consideration. The appeals court also held that the Commodity Exchange Act’s exclusive-jurisdiction provision did not cover the contracts at issue, while leaving the dismissal of the tribes’ Lanham Act false-advertising claim intact.

The case had been stayed since May 22 pending related Ninth Circuit appeals. The appellate court issued its mandate on Oct. 8, and the district court’s latest order followed an Oct. 21 case-management conference in the Northern District of California.

The plaintiffs must file their amended complaint by Nov. 4. The court terminated the defendants’ pending dismissal motions without prejudice and set a further case-management conference for 2 p.m. that day; an updated joint case-management statement is due by noon on Nov. 3.