Partners Katherine Baker and Tim Wagner were quoted in an S&P Global article discussing a federal appeals court ruling on prediction markets that is positioning the industry for a US Supreme Court fight, which could determine whether billions of dollars in monthly trading falls under federal or state gambling regulations.

“To wipe out a foundational, historic state police power like the regulation of gambling would be extreme and out of line with Supreme Court precedent," Katherine Baker, chair of Nelson Mullins' gaming industry practice, told S&P Global Market Intelligence. 

Tim Wagner shared what is at stake for the states is not just their legal jurisdiction but also millions of dollars in tax revenue.

“Tim Wagner, a partner at Nelson Mullins, said the state resistance is primarily about preserving regulatory authority over gambling rather than lost revenue, though he noted that licensing would establish nexus for corporate taxation of out-of-state platforms.”

Baker offered further insight on Supreme Court timing.

“As to how soon the Supreme Court may be called to take up the issue, Nelson Mullins' Baker said the Ninth Circuit is expected to rule by summer in consolidated cases involving Kalshi, Robinhood and Crypto.com against Nevada. Oral arguments in April suggested the court will rule against platforms, she said, which would create a circuit split with the Third Circuit. Perry identified the Third Circuit case as the likely Supreme Court vehicle because it was the first appellate ruling on preemption. If a circuit split emerges, Baker said a cert petition could come by late 2026 or early 2027, with a Supreme Court decision during the 2027-2028 term.”

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