KalshiEX LLC v. Schuler (6th Cir., consolidated with the Tennessee appeal)

Overview

The third federal appeals court to rule, and the second against the platforms. Kalshi sued both states pre-emptively. In Tennessee, Judge Aleta Trauger (M.D. Tenn.) granted it a preliminary injunction in February 2026, finding its sports event contracts likely "swaps"; in Ohio, Chief Judge Sarah Morrison (S.D. Ohio) denied one. The Sixth Circuit heard the two appeals together on July 30, 2026 (Clay, Gibbons and Bloomekatz, JJ.).

On September 25, 2026 it ruled for both states in a published opinion by Judge Gibbons, with no separate concurrence or dissent. It affirmed the Ohio denial, vacated the Tennessee injunction and remanded both. The holding has two independent parts. First, Kalshi “has not shown that its sports-event contracts satisfy the statutory definition of a ‘swap’” and so has not shown they fall within the CFTC’s exclusive jurisdiction. Second, “even assuming that Kalshi’s sports-event contracts are swaps,” the Commodity Exchange Act “neither expressly nor impliedly preempts Ohio’s or Tennessee’s gambling laws.”

That second holding is what sets it apart. The Ninth Circuit agreed with the Third that the Act preempts state regulation of futures trading and split only on whether sports contracts are covered; the Sixth Circuit held that even covered contracts would not displace state gambling law. It is binding on every federal court in Ohio, Tennessee, Michigan and Kentucky, including the three pending Michigan platform appeals. Like the others, it reviews preliminary-injunction rulings, not final judgments.

Changes

Logged September 26, 2026

• RulingSeptember 25, 2026

  The Sixth Circuit ruled for Ohio and Tennessee in a published opinion: Kalshi has not shown its sports contracts are swaps, and even if they were, the CEA would not preempt either state’s gambling law. It affirmed Ohio’s denial and vacated Tennessee’s injunction. The circuits now stand two to one against the platforms.

  Sixth Circuit opinion, Nos. 26-3196/5235

Timeline

What's next: A petition for rehearing en banc would be due fourteen days after judgment, about October 9, 2026; Kalshi could also seek certiorari. The Tennessee injunction ends when the mandate issues. Both cases then return to the district courts. The decision also ends the abeyance on Michigan’s remand appeal and binds the three Michigan platform appeals.

Parties