A lawsuit has been filed by three pueblos in New Mexico and one tribe against the prediction market platform Kalshi, accusing the company of enabling unlawful sports betting on tribal lands, violating federal regulations and tribal gaming compacts.
The legal action, revealed on Wednesday by the Mescalero Apache Tribe along with Pojoaque, Sandia, and Isleta pueblos, alleges that Kalshi permits individuals as young as 18 to engage in sports wagering within New Mexico, jeopardizing tribal gaming income that is essential for funding education and government services, according to Source NM.
“Utilizing prediction markets for gambling creates a diversion of vital revenue from our governments, circumvents the regulation of gaming on our territories and facilitates underage gambling,” stated Sandia Pueblo Governor Stuart Paisano.
According to New Mexico tribal gaming agreements and federal law, gambling is restricted to persons aged 21 and older.
The lawsuit, submitted by a law firm from Washington, contends that Kalshi, based in New York, did not deploy geofencing technology to prevent usage of its platform within tribal jurisdictions. The complaint asserts that the company’s practices breach the federal Indian Gaming Regulatory Act and impinge upon tribal sovereignty rights affirmed by the U.S. Supreme Court in 1987.
As proof, the lawsuit presents a screenshot depicting New Mexico users making trades through Kalshi during a University of New Mexico Lobos basketball game against New Mexico State University last November.
This legal maneuver signifies another phase in the ongoing efforts by New Mexico tribes to combat prediction market platforms that provide sports-related contracts.
Recently, U.S. Representative Gabe Vasquez (D-N.M.) visited a school located on Isleta Pueblo land that depends heavily on revenue from tribal gaming for its operations. At the time, Isleta Pueblo Governor Eugene Jiron expressed concerns regarding the long-lasting repercussions of prediction markets functioning as covert sports betting platforms. Vasquez mentioned he is in the process of formulating legislation aimed at blocking services such as those provided by Kalshi and Polymarket.
Tribal leaders have previously expressed their apprehensions about these platforms. In July, Duane Duffy, Vice President of the Mescalero Apache Tribe, urged state lawmakers to take decisive action against prediction markets. In the statement released on Wednesday, Duffy emphasized that tribes in New Mexico have “struggled fiercely to safeguard their intrinsic sovereign right to manage and supervise casinos on tribal lands.”
“We cannot passively observe as the laws that protect this right are flouted,” Duffy added.
The New Mexico lawsuit reflects similar legal challenges faced by the Ho-Chunk Nation in Wisconsin, which initiated a lawsuit against Kalshi last August over claims that the company unlawfully offered sports betting on tribal territory.
A federal judge recently denied the tribe’s emergency request to halt Kalshi’s operations in Wisconsin but indicated that the tribe had shown a “strong likelihood of success” in pursuing claims under federal Indian gaming law.
According to the New Mexico Gaming Control Board’s most recent data, 14 tribes and pueblos in the state achieved an adjusted net gaming revenue of over $266 million during the final quarter of 2025. This figure encompasses revenue from gaming machines after payouts and regulatory fees, although the state does not break down how much of this revenue was derived from sports betting.