Case 2:25-cv-00575-APG-BNW Document 237 Filed 11/24/25 Page 10 of 29
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That does not explicitly confine all statutory interpretations of the CEA’s language, including its definition of a word like “swap,” to the CFTC with no room for court interpretation except through an APA action. For example, if a DCM chose to run on its exchange an auction for real property it had no authority to auction off, no one would conclude that is a swap or a commodity within the CEA’s meaning. Yet according to Kalshi, a DCM could run the auction, hope the CFTC does not notice, and no one else could do anything about it except file an APA suit against the CFTC (not against the DCM) even though an auction of real property plainly does not fall within the CFTC’s exclusive jurisdiction under 7 U.S.C. § 2(a). I disagree. A DCM cannot insulate itself from state regulation through self-certification where its conduct does not fall within the CFTC’s exclusive jurisdiction provision. Kalshi brought this suit to obtain injunctive relief, arguing that state law is preempted. Courts routinely evaluate statutory language to determine whether state law is preempted and the scope of any preemption. See, e.g. , Virginia Uranium, Inc. v. Warren , 587 U.S. 761, 767 (2019) (examining “arguments about the [Atomic Energy Act’s] preemptive effect much as [the Court] would any other about statutory meaning, looking to the text and context of the law in question and guided by the traditional tools of statutory interpretation”); Wyeth v. Levine , 555 U.S. 555, 566-81 (2009); Bates v. Dow Agrosciences LLC , 544 U.S. 431, 443-44 (2005) (“That [a preemption clause in a federal statute] may pre-empt judge-made rules, as well as statutes and regulations, says nothing about the scope of that pre-emption.”). I therefore reaffirm my position in Crypto that in evaluating Kalshi’s preemption arguments and the Board’s defenses against preemption, I can interpret the statutory language to determine what falls within the CFTC’s jurisdiction in the first place.
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