10th Circuit lets Utah keep enforcing gambling laws against Kalshi

The 10th U.S. Circuit Court of Appeals has denied Kalshi’s emergency request for an injunction pending appeal, leaving Utah free for now to pursue civil or criminal enforcement against the prediction-market company while the case continues. The court said Kalshi had not shown that the stay factors weighed in its favour.

The decision is procedural. It does not settle the central dispute over whether the Commodity Exchange Act preempts Utah’s gambling laws as applied to Kalshi’s sports contracts.

As covered in August, U.S. District Judge Robert J. Shelby had already granted Utah summary judgment, denied Kalshi’s preliminary injunction as moot and closed the case. Shelby held that the federal commodities law does not block Utah from enforcing its gambling prohibitions, reasoning that gambling is traditionally regulated by the states and that it would be implausible to read the statute as forcing states to permit contracts that amount to gambling under state law.

Kalshi filed the underlying lawsuit in February against Governor Spencer J. Cox and Attorney General Derek Brown, asking for a declaration that federal law preempts Utah’s anti-gambling rules and for an order blocking state enforcement. After losing in the district court, the company appealed to the 10th Circuit and sought emergency relief to stop enforcement during the appeal.

Utah’s attorney general welcomed the ruling. Brown’s office said it was grateful the court had properly denied the stay request, but declined to say whether any enforcement action was imminent.

If Utah chooses to act, the stakes are significant. State law treats offering online gambling to anyone in Utah as a third-degree felony, and lawmakers passed H.B. 243 in 2026 to clarify that some proposition-style betting falls within the state’s gambling prohibitions.

The case sits within a wider fight over prediction markets and sports-related event contracts. States say the products are unlicensed gambling subject to state law, while Kalshi argues that as a CFTC-regulated exchange it falls under federal jurisdiction.