Accordingly, the balance of preliminary injunction factors weighs in Kalshi’s favor, and the court will grant Kalshi’s Motion for Preliminary Injunction (Doc. No. 6) as to the state-official defendants. E. Bond The court has discretion over whether the movant needs to post a security bond and, if so, how much it should be. Appalachian Reg’l Healthcare, Inc. v. Coventry Health & Life Ins. , 714 F.3d 424, 431 (6th Cir. 2013). In compliance with this court’s TRO, Kalshi has already posted $500 in security. (Doc. No. 22 at 2; Doc. No. 25.) Kalshi requests that the court require no further security, or, in the alternative, a de minimis bond, because the defendants “will suffer no nonspeculative damage by halting enforcement against Kalshi during the pendency of this litigation.” (Doc. No. 7 at 32 n.7.) The defendants request that, if the court grants Kalshi’s motion, it require a bond of $875,000. (Doc. No. 34 at 42.) According to the defendants, this amount represents 10% of the fine Kalshi would owe the state if it had accepted just one sports wager each day since it first offered sports event contracts, in January 2025. ( Id. (citing Tenn. Code Ann. § 4- 49-127).) 21 Kalshi argues that the defendants’ request is unreasonable. (Doc. No. 41 at 15.) important state interest.” ( Id. at 10–11 (citations omitted).) And the court notes that part of the taxes on licensed sports gambling in Tennessee goes toward fighting problem gambling. On the record presently before the court, it does not appear that Kalshi limits its services to those 21 and over, and therefore the state’s legitimate concern that Kalshi contributes to problem gambling, particularly among young adults, is not lost on this court. However, as the District of Columbia has stated, “[t]his case is not about whether the Court likes Kalshi’s product or thinks trading it is a good idea. The Court’s only task is to determine what Congress did, not what it could do or should do.” Kalshi D.D.C. , 2024 WL 4164694, at *1. 21 Alternatively, there are 53,233 “full-fledged Kalshi Members” with a Tennessee address. (Doc. No. 9, Sottile Decl. ¶ 30.) Assuming each of those members has made exactly one trade, Kalshi could be liable to the state for $1,330,800,000. Tenn. Code Ann. § 4-49-127(b)(2) (listing penalties for the first ($10,000), second ($15,000), and subsequent offenses ($25,000)).
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Case 3:26-cv-00034 Document 48 Filed 02/19/26 Page 24 of 25 PageID #: 892
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