USCA4 Appeal: 25-1892
Doc: 16
Filed: 10/15/2025
Pg: 53 of 97
cash reserve requirements, see Md. Code Ann. , State Gov’t
§ 9-1E-04(b)(6)(vi) (2022); Md. Code Regs. 36.10.14.06 (2025), but those
requirements conflict with the CEA’s different command that DCMs work
through federally regulated clearinghouses that collateralize open positions. See 7 U.S.C. § 7a-1. Maryland dictates “the manner in which wagers are
received and payouts are remitted ” and the “ maximum wagers that may be
accepted ” by bettors, Md. Code Ann., State Gov ’ t § 9-1E-04(b)(6) (2022),
obligations which likewise conflict with the CEA, which fixes “ limits on the
amounts of trading which may be done or positions which may be held by
any person ,” 7 U.S.C. § 6a, and which specifies complex “[s]ettlement
procedures ” for trades. 7 U.S.C. § 7a-1(c)(2)(E). And pulling contracts from
individual states, as Maryland has demanded, would risk “ market
disruption s” and facilitate “ manipulation ”— additional violations of the Core Principles. See 17 C.F.R. §§ 38.255, 38.200. This is a quintessential case of impossibility preemption —where federal law “forbids what the state law requires.” Nat’l Meat Ass’ n v. Harris , 565 U.S. 452, 460 (2012). 3. Application of Maryland’s gambling laws to Kalshi would conflict with Congress’s chosen “method of enforcement.” Arizona , 567 U.S. at 406.
Congress in 2010 recognized that event contracts involving “gaming” may
raise public-interest implications, and created a specific mechanism for
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