USCA4 Appeal: 25-1892
Doc: 16
Filed: 10/15/2025
Pg: 35 of 97
LLC v. Hendrick , No. 2:25-cv-00575, 2025 WL 1073495, at *8 (D. Nev. Apr. 9, 2025); KalshiEX LLC v. Flaherty , No. 25-cv-02152, 2025 WL 1218313, at
*8 (D.N.J. Apr. 28, 2025). Both courts recognized that the CEA’s grant of
“exclusive jurisdiction” to the CFTC preempted state regulation of trading on DCMs. Hendrick , 2025 WL 1073495, at *5-6 (holding that “Section 2’s plain
and unambigu ous language” “reflects congressional intent to occupy the field
of regulating CFTC-designated exchanges and the transactions conducted on those exchanges” ); Flaherty , 2025 WL 1218313, at *5 (similar). New Jersey
appealed the preliminary injunction to the Third Circuit; that appeal has
been briefed and argued.
Breaking with its peer courts, the district court here denied Kalshi’s
motion on August 1, 2025. JA178. It “assume[d] without deciding that
Kalshi’s sports - event contracts are in fact swaps” under the CEA. JA156.
But, relying heavily on a presumption against preemption, the court rejected
both field and conflict preemption.
As to field preemption, the court acknowledged that “Congress had some field-preemptive intent ” when it enacted the CEA and when it added
swaps to the CFTC’s exclusive jurisdiction in Dodd -Frank. JA162. But the
court held that this did not “necessarily establish that the ‘field’ that Congress
intended to ‘occupy’ included gambling.” JA160. Concluding that the
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