Case 2:25-cv-00575-APG-BNW Document 45 Filed 04/09/25 Page 2 of 17
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event-based contracts including, for example, who will win a sporting event or which party will have control over the House of Representatives. Id. at 3; ECF No. 1 at 12-13 ¶¶ 47, 53. On March 4, 2025, the Nevada Gaming Control Board (Board) sent Kalshi a cease-and- desist letter advising Kalshi that “offering event-based contracts is unlawful in Nevada” unless the Nevada Gaming Commission approves it. ECF No. 1-2 at 2. The Board advised Kalshi that anyone who operates a sports pool in Nevada must be licensed under Nevada Revised Statutes (NRS) § 463.160. Id. at 3. Section 463.0193 defines a sports pool as “the business of accepting wagers on sporting events or other events by any system or method of wagering.” According to the Board’s letter, an election counts as an “other event.” ECF No. 1-2 at 2; see also Nev. Gaming Comm’n reg. 26B.020(8) (defining “other event” to mean “an event other than . . . [a] horse race, . . . greyhound race, or . . . athletic sporting event sanctioned by a governing body”). The Board advised that “Kalshi’s event-based contracts allow a person to place money on the outcome of an uncertain event,” so Kalshi is operating an unlicensed sports pool in violation of Nevada law, and that doing so is a category B felony. Id. at 3 (citing NRS § 463.360). The letter advised that even if Kalshi had a license to operate a sports pool, Nevada public policy prohibits wagering on elections. Id. ; see also NRS § 293.830 (making it a misdemeanor to make, offer, or accept a bet or wager on election results, the success or failure of any candidate, the number of votes cast, etc.). The Board’s letter stated that Kalshi has been violating Nevada law and “any offenses by Kalshi after receipt of this letter shall be considered willful violations of Nevada law.” ECF No. 1-2 at 3. The Board ordered Kalshi to cease and desist, and to confirm Kalshi would do so by March 14, 2025. Id. Kalshi sues the Board, the Nevada Gaming Commission, and their members in their official capacities for declaratory and injunctive relief. Kalshi argues that its exchange is subject
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