When four New Mexico tribes filed a federal lawsuit against Kalshi in May 2026, it was the legal endpoint of a process that started in public ten months earlier — at a state legislative committee meeting held on tribal land.
On Monday, July 7, 2025, the New Mexico Legislature’s interim Economic & Rural Development & Policy Committee met at the Inn of the Mountain Gods on the Mescalero Apache Reservation. The choice of venue was deliberate: tribal officials wanted lawmakers to hear directly about how unregulated online betting platforms were affecting tribal gaming, the largest economic engine for several New Mexico tribes.
”Taking it out of our pockets”
Duane Duffy, Vice President of the Mescalero Apache Reservation, told the committee that platforms like Kalshi were allowing customers to place sports bets in New Mexico “under the guise of commodity futures trading.” He didn’t mince words about the impact:
“That is a threat to the gaming market here in the state, and a clear violation of the state tribal gaming compacts.”
“There’s no mechanism that exists right now that allows the tribes or racinos to engage in internet gaming, and to have these outside entities from outside the state doing that … it’s taken out of our pockets.”
Also testifying that day were Lauren Rodriguez, Chief of Staff for the New Mexico Attorney General, and Sen. Bill Sharer (R-Farmington), among other legislators.
Why this matters for the Mescalero
For the Mescalero Apache Tribe, internet sports betting is not an abstract policy question. The Inn of the Mountain Gods and its casino generated more than $15 million in the first quarter of 2025 alone, according to tribal figures reported to the committee — and that casino is the tribe’s sole source of revenue excluding federal and state grants. The tribe’s adjacent Ski Apache resort has lost customers as snowpack has declined, putting additional pressure on the gaming operation.
Statewide, tribal casinos generated more than $219 million in adjusted net win in Q1 2025, and the state received over $20 million in general fund revenues that quarter from tribal gaming revenue sharing.
The plan
At the July 2025 hearing, tribal leaders previewed two parallel paths to address the issue:
- Approach the state Legislature during the 30-day session starting January 2026, asking lawmakers to clarify state law and aid enforcement.
- Seek help from the New Mexico Attorney General’s office to pursue companies “through potential legislation or lawsuits.”
The 2026 NM legislative session ended without a sports betting bill advancing. Ten months and one inaction-filled session later, four tribes — Mescalero Apache, Isleta Pueblo, Pojoaque Pueblo, and Sandia Pueblo — filed the federal Kalshi suit.
The compact angle
Tribal officials at the July 2025 hearing repeatedly pointed to the 2015 Class III gaming compacts, which are in effect until 2037. The compacts require the state and tribes to reopen “good-faith negotiations” if any “internet gaming” is authorized in New Mexico. The tribes’ position: by accepting bets from NM residents, prediction-market platforms create a de facto online gaming environment that was supposed to trigger renegotiation — not exist outside the compact framework entirely.
That argument is the legal backbone of the federal complaint filed nearly a year later. Learn more about the NM tribal compact framework and why online sports betting remains illegal in NM.