Capitol Briefs: Sports betting and lowriders

Things have slowed down a bit now that we are past the house of origin deadline, but there is still plenty going on in California politics.  

More fighting over sports betting: More than 60 tribal governments and tribal organizations across the country – including several of the biggest hitters from California – submitted an amicus brief this week in a high-stakes federal case over sports gaming and prediction markets.

The case centers on an outfit called Kalshi, which was recently the subject of a long feature story on ESPN.com. Kalshi is one of a handful of nationwide prediction markets where online users can buy contracts – essentially predictions – on future events, including the outcomes of elections and sporting events. Kalshi and other prediction markets are regulated at the federal level, by the Commodity Futures Trading Commission.

But in practice, as the ESPN piece and many others have pointed out, Kalshi operates like a sportsbook, where users can bet on the outcome of games. Sportsbooks are regulated at the state level. The state of New Jersey tried to get Kalshi to stop what it’s  doing, but the company took the state of federal court, where the case is now on appeal.

Because Kalshi is regulated federally, it can operate legally in California where sports betting, of course, is not legal. That has drawn the ire of California’s gaming tribes, which soundly defeated attempts to legalize sports betting in the 2022 election.

To California’s gaming tribes, Kalshi represents a legal end-round that essentially undoes the results of that pricey, bitterly contested election. Moreover, Kalshi is mounting a vigorous defense of its business model in court – and it’s been winning.

So, it’s no surprise to see the Morongo Band of Mission Indians (the owner of the Morongo Casino Resort & Spa near Palm Springs); the Pechanga Band of Indians (the owner of the Pechanga Resort Casino in Temecula);  the Yuhaaviatam of San Manuel Nation (formerly known as the San Manuel Band of Mission Indians, the owner of the Yaamava’ Resort & Casino in Highland as well as the iconic Palms Casino Resort in Las Vegas) and the California Nations Indian Gaming Association or CNIGA, among others, signing onto the brief supporting the state of New Jersey’s attempts to regulate Kalshi.

A separate brief in support of the Garden State also was filed this week by 34 states, including Nevada (which is battling Kalshi in a separate case). California was not among those states, but sports betting also isn’t legal in the Golden State and there’s yet to be any broad consensus on how it should be legalized here.

The Capitol community might not be aware of this fight, but it’s of enormous importance to gaming tribes across the country, but particularly to California’s gaming tribes as they thought they had control over the sports betting market here after the 2022 election.

Stay tuned. This is far from over.

Lowrider Holiday comes to the Capitol: Get ready for the third annual California Lowrider Holiday on Capitol Mall from noon to 5PM this Sunday, June 22. Hundreds of lowrider enthusiasts from across the state will gather to display and cruise in their rolling works of art and celebrate Lowrider and Chicano culture. The event began as a demonstration in support of AB 436, which lifted bans on cruising that were put in place in the 1980s. The bill, by Assemblymembers David Alvarez and Luz Rivas, was signed by Governor Newsom in 2023 and took effect the next year. While the Lowrider Holiday is not billed as a protest, this year’s event comes as ICE raids stir intense clashes between federal immigration authorities and California’s immigrant communities, giving the day an undeniable political air.