Case 2:25-cv-00575-APG-BNW Document 45 Filed 04/09/25 Page 13 of 17
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“proponents were concerned that the states . . . might step in to regulate the futures markets themselves,” which would subject “the national futures trading apparatus to conflicting regulatory demands,” and the Senate Committee on Agriculture and Forestry “delet[ed] . . . a CEA provision which appeared to preserve the states’ authority over futures trading”); see also The Commodity Futures Trading Commission Act of 1974 Committee Report by the U.S. Senate Committee on Agriculture and Forestry, 93rd Cong., 2d Sess., at 11 (Nov. 15, 1974) (stating that “[u]nder the exclusive grant of jurisdiction to the Commission, the authority in the Commodity Exchange Act (and the regulations issued by the Commission) would preempt the field insofar as futures regulation is concerned”). In sum, if Kalshi were offering its contracts without CFTC designation, then the defendants could regulate it. But because Kalshi is a CFTC-designated DCM, it is subject to the CFTC’s exclusive jurisdiction and state law is field preempted. 6 Nevada regulatory agencies thus have no jurisdiction to decide that Kalshi’s conduct violates state law where, at least at present, those activities are legal under federal law. Because the CFTC has approved (or at least not yet disapproved) Kalshi’s sports-related contracts, the defendants cannot pursue civil or criminal liability against Kalshi for offering those contracts. And because (1) the district court in KalshiEX LLC found in Kalshi’s favor, (2) the D.C. Circuit denied the CFTC’s request for a stay pending appeal, and (3) the D.C. Circuit has not overturned the district court’s decision as of this date, Kalshi’s election-based contracts are also currently legal under federal law. The defendants argue that Kalshi is judicially estopped from challenging the application of Nevada gaming law to its sports contracts based on an argument that Kalshi made in its litigation against the CFTC. There, Kalshi argued its election contracts do not involve gaming
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6 I therefore need not address conflict preemption.
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