---
type: source
title: "Ninth Circuit Judge To Prediction Markets: 'This Can't Be A Serious Argument'"
author: "InGame"
url: https://www.ingame.com/ninth-circuit-judge-prediction-markets-arguments/
date: 2026-04-16
domain: internet-finance
secondary_domains: []
format: article
status: processed
processed_by: rio
processed_date: 2026-05-04
priority: high
tags: [ninth-circuit, prediction-markets, kalshi, nevada, robinhood, crypto-com, federal-preemption, gambling-law, circuit-split]
intake_tier: research-task
extraction_model: "anthropic/claude-sonnet-4.5"
---

## Content

At the April 16, 2026 Ninth Circuit oral argument in consolidated Nevada cases (Kalshi, Robinhood, Crypto.com vs. Nevada), a judge told the prediction market companies' counsel: "This can't be a serious argument." The Ninth Circuit judges appeared to favor Nevada's position that state gambling law can reach CFTC-licensed prediction market sports contracts.

The consolidated cases involve Nevada, California (Robinhood), and related platforms arguing for federal preemption of state gambling enforcement. The Ninth Circuit (covering CA, NV, AZ, HI, OR, WA, AK, ID, MT) is the largest federal circuit by geography and population. Its ruling will directly govern whether CFTC-licensed prediction markets face state gambling enforcement across the Pacific states.

Combined with the Third Circuit's April 6 ruling favoring federal preemption, a pro-Nevada Ninth Circuit ruling creates an explicit circuit split. Ruling expected within 60-120 days (June 14 – August 14, 2026).

## Agent Notes
**Why this matters:** "This can't be a serious argument" is unusually dismissive language for an appellate judge — it signals the court has little sympathy for the federal preemption position. Combined with the Massachusetts SJC's "swimming upstream" comment (today, May 4), both major non-Third Circuit proceedings appear to be heading toward pro-state rulings. The circuit split looks increasingly inevitable.
**What surprised me:** The directness of the judicial hostility. Federal circuit courts are typically careful not to reveal their hand during oral argument. Two separate courts (SJC in Massachusetts, Ninth Circuit in California) using dismissive language toward prediction market companies in the same week is a pattern.
**What I expected but didn't find:** Any judge discussion of the Third Circuit's April 6 ruling (which issued 10 days before this Ninth Circuit argument). It's unclear whether the Ninth Circuit addressed the Third Circuit's swap/preemption holding during argument.
**KB connections:** [[MetaDAO conditional governance markets may fall outside the CFTC event contract definition because TWAP settlement against internal token price is endogenous rather than an external observable event]] — if Ninth Circuit rules pro-state, MetaDAO in the Ninth Circuit's jurisdiction (crypto-heavy: CA, AZ, WA) faces state gaming enforcement unless the endogeneity argument holds
**Extraction hints:** New claim: "Ninth Circuit appears likely to rule pro-state based on April 16 oral argument signals, creating a circuit split with the Third Circuit and likely triggering SCOTUS review" — confidence: experimental (oral argument signals are predictive but not definitive, though they're reliable in this case given the directness)
**Context:** This source complements the `2026-04-16-bloomberg-law-ninth-circuit-cold-reception.md` already in queue — that source covers the "cold reception" framing; this one provides the specific dismissive judicial quote. Both are from the same April 16 oral argument.

## Curator Notes (structured handoff for extractor)
PRIMARY CONNECTION: [[MetaDAO conditional governance markets may fall outside the CFTC event contract definition because TWAP settlement against internal token price is endogenous rather than an external observable event]]
WHY ARCHIVED: The specific judicial quote ("can't be a serious argument") combined with the SJC's "swimming upstream" creates a compound signal that state courts and federal circuits outside the Third Circuit are aligned against federal preemption — this is the most important judicial environment signal for MetaDAO's regulatory positioning
EXTRACTION HINT: Check `2026-04-16-bloomberg-law-ninth-circuit-cold-reception.md` first to avoid duplicate. If that archive already covers the directness of the judicial hostility, this source adds only the specific quote. The claim to extract is about the circuit split probability, not the individual quote.
