Kalshi Sues Louisiana, Opening a Potential Fifth Circuit Fight

Kalshi is not waiting for Louisiana to bring an enforcement case.

The exchange sued state officials Oct. 23, arguing that their public statements, regulatory actions and new gambling laws create an imminent threat to its event contract business.

The complaint seeks to stop Louisiana from applying its gambling laws to products Kalshi says fall under exclusive federal regulation.

Filed in the Western District of Louisiana, the case also opens a potential route to the Fifth Circuit Court of Appeals, another appellate venue in a national fight that has already produced conflicting decisions.

The defendants include Attorney General Liz Murrill, Gov. Jeff Landry, Gaming Division Director Dawn Himel, the Louisiana Gaming Control Board and other officials.

Kalshi moves before the state does

The case, KalshiEX LLC v. Murrill et al., is a preemptive challenge, not a response to a newly announced Louisiana lawsuit.

Daniel Wallach reported the filing Oct. 24, highlighting Kalshi’s allegation that officials “will imminently bring an enforcement action” to bar its contracts. That is the company’s assessment of the threat, not a court finding that enforcement is imminent.

🚨 BREAKING: Kalshi sues Louisiana in federal court, alleging state officials “will imminently bring an enforcement action” to bar its event contracts, pointing to public statements made between Dec. 2025 and Mar. 2026, amicus brief filings, and no assurances of non-enforcement. pic.twitter.com/FIWVO3dP9e

— Daniel Wallach (@WALLACHLEGAL) October 24, 2026

The complaint cites statements from Louisiana officials and the gaming board’s position that Commodity Futures Trading Commission (CFTC) registration does not shield an operator from state gambling laws.

“The Louisiana Gaming Control Board … has formally declared that such contracts are illegal gambling even when listed on a CFTC-regulated exchange,” Kalshi’s lawyers wrote, quoting the board as seeing “no defense to offering such activity pursuant to a CFTC license.”

Kalshi’s legal theory is familiar: the Commodity Exchange Act gives the CFTC exclusive jurisdiction over its contracts, preventing Louisiana from imposing a separate gambling regime. Louisiana officials have publicly taken the opposite position.

New enforcement powers raise the stakes

Kalshi also points to Louisiana legislation that took effect Aug. 1, expanding the state’s definition of “gambling by computer” and strengthening enforcement tools.

According to reporting on the complaint, those tools can include injunctions, website removal, and freezing associated bank and credit accounts. Kalshi argues that the law also exposes businesses supporting a platform, including payment processors, media affiliates and geolocation providers, to potential criminal penalties.

That broadens the commercial threat beyond whether Kalshi itself can accept a Louisiana trade. Enforcement aimed at service providers could make it harder to operate even before a final decision on federal preemption.

The company says officials have offered no assurance that they will refrain from enforcing Louisiana law, leaving it with “no option but to seek judicial relief.”

Another possible appellate route

The Louisiana filing adds a new district court case within the Fifth Circuit, which covers Louisiana, Mississippi and Texas. If a relevant ruling is appealed, that court could weigh in on the same federal-versus-state question being litigated elsewhere. The filing alone does not put the dispute before appellate judges.

That potential route matters because Kalshi is fighting an increasingly divided appellate map.

The Third Circuit sided with the exchange in its New Jersey dispute. The Ninth Circuit ruled against Kalshi in Nevada, while the Sixth Circuit on Sept. 25 affirmed the denial of preliminary protection in Ohio and vacated an injunction that had protected Kalshi in Tennessee.

Kalshi requested rehearing in the linked Ohio and Tennessee appeals Oct. 9. Its petition argues that the panel’s treatment of swaps and federal preemption conflicts with other decisions and should be reconsidered in light of new CFTC rulemaking. The request does not overturn the panel ruling or reinstate the Tennessee injunction.

A Fifth Circuit appeal could therefore add another influential ruling to the national dispute. It is an avenue, not a guaranteed favorable venue, and not evidence that the court has agreed to hear anything yet.

The Supreme Court fight is already underway

The broader jurisdictional question is already reaching the U.S. Supreme Court through petitions arising from other states.

New Jersey asked the justices to review the Third Circuit’s pro-Kalshi ruling. Gaming regulators and industry groups have urged review, arguing that the disagreement over state authority needs a national resolution. Related Nevada petitions offer another route for the court to consider the issue.

The Supreme Court has not agreed to hear those cases. Kalshi’s response in the New Jersey matter is due Nov. 9.

Louisiana’s case does not need to reach the Supreme Court to matter in the meantime. A district-court ruling could determine whether the state can proceed against Kalshi while the broader litigation continues, and an appeal could further develop the conflict among federal courts.

Kalshi is asking a federal judge to get ahead of Louisiana’s anticipated crackdown. Whether that produces protection, or another adverse ruling to appeal, is the next question.