nationwide authorization of such betting under the sole jurisdiction of the CFTC. 7 Whether Congress did so is a major question. Under the Major Questions Doctrine, courts have “reason to hesitate before concluding that Congress meant to confer” agency authority in cases where the agency has asserted a “breadth” of authority over matters of “economic and political significance.” West Virginia v. EPA , 597 U.S. 697, 721 (2022) (internal quotation marks omitted). In such cases, considering “both separation of powers principles and a practical understanding of legislative intent,” there must be “clear congressional authorization.” Id. at 723 (internal quotation marks omitted). Further, “Congress [does not] typically use oblique or elliptical language to empower an agency to make a ‘radical or fundamental change’ to a statutory scheme.” Id. (quoting MCI Telecommunications Corp. v. Am. Telephone & Telegraph Co. , 512 U.S. 218, 229 (1994)). In effect, Kalshi contends that the 2010 CEA amendments displaced state and tribal gaming regulations, nullified all tribal-state gaming compacts, legalized sports betting nationwide, and placed sports betting under the exclusive regulatory jurisdiction of the CFTC, all at a time when federal law broadly prohibited sports betting. This is unquestionably a “radical” and “fundamental” overhaul to both PASPA and IGRA, and certainly raises concerns of “economic and political significance.” This Court therefore has significant “reason to hesitate” and should require “clear congressional authorization” before even considering Kalshi’s preemption argument. Id. at 721, 724.
7 Kalshi’s sports-betting contracts also violate other federal laws, including the Wire Act, 18 U.S.C. § 1084, the Illegal Gambling Business Act, 18 U.S.C. § 1955, and the Travel Act, 18 U.S.C. § 1952(a). If Congress authorized sports betting via the CEA in 2010, then it also effectively limited the scope of these federal laws, in addition to PASPA.
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NSH 3426338.2
Case 3:26-cv-00034 Document 40-1 Filed 01/23/26 Page 15 of 22 PageID #: 452
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