This post first appeared in the Politics Report.
Kalshi this week announced it had entered into a brand partnership with the Padres and three other of the “most beloved teams in baseball” including the Dodgers.
It came just a couple days before the Ninth Circuit Court of Appeals ruled that Kalshi is illegally operating sports betting in California.
Kalshi self describes as a “next-generation financial exchange” but it functions like a betting platform. Rather than betting at a casino against its sports book, Kalshi customers are buying futures contracts on whether a team will win or lose or endless other uncertain outcomes. It’s part of the proliferation of 24/7 digital access to gambling that has swept the nation.
Fernando Tatis Jr. and several other players told the U-T a year ago that the explosion in gambling had vastly increased the harassment they receive.
“It’s constant. People just wishing us death to ourselves, to our family. This is the new thing, I guess,” he said.
So it was a little odd to see the Padres partner with one of those betting platforms. The court ruling this week makes it even weirder.
Betting on sports is not allowed in California. There were two rival ballot measures a few years ago trying to change that and both failed.
Nevada obviously allows sports betting but heavily regulates it and tried to shut down Kalshi. Kalshi sued.
“Kalshi sought injunctive relief, arguing that it is not a legal sports betting platform, but a designated contract market under the Commodity Exchange Act (CEA) offering legal sports event contracts,” reads the Ninth Circuit ruling put out Wednesday.
Judge Ryan D. Nelson, in his opinion, cited Kalshi’s own words advertising itself as “the first app for legal sports betting in all 50 states.”
That seems unambiguous. But in court, Kalshi argues that sports bets and events contracts are different.
“Kalshi users can effectively place prop bets, bet the point spread, bet a specific score, or create a several-leg parlay. And the payout depends on the performance of a sports team or a player,” the court opined.
Those bets are not legal in California. Kalshi will appeal and the U.S. Supreme Court may have to settle it. It’s a fight that goes all the way to the top and includes President Trump, whose son, Donald Trump Jr., told state attorneys general to back off. He’s a paid adviser to the company.
Meanwhile, Kalshi seems likely to still proceed with its advertising and “exclusive on-site activations” for Padres fans interested in placing a futures contract on whether the Padres win or Tatis hits a home run. For now, it appears death threats hurled at him if he fails are still not allowed.