Case 2:25-cv-01541-APG-DJA Document 32 Filed 09/30/25 Page 8 of 21
regulations only emphasizes this point. 6 Second, the plain language of the CEA does not conflict with IGRA, except to the degree
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that Robinhood and others have unlawfully attempted to use it as a means of evading
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comprehensive gaming regulations. Instead, compliance with both statutory regimes is entirely
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possible, and nothing within IGRA’s requirements to offer Class III gaming on Indian lands
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obstructs or invalidates the provisions of the CEA.
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The CEA’s savings clause therefore expressly reserves the authority of the NIGC and
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Tribal gaming authorities over gaming on Indian lands, in accordance with IGRA.
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2)
The CFTC expressly prohibits Robinhood’s sports event contracts
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Robinhood’s sports event contracts are categorically prohibited by the CFTC as contrary to
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the public interest. See 17 C.F.R. § 40.11(a)(1). Robinhood is not authorized to offer such
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contracts under the CEA and its sports event contracts are therefore invalid and fall beyond the
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scope of the CFTC’s “exclusive” jurisdiction.
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The Special Rule grants the CFTC discretion to determine whether event contracts are
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“contrary to the public interest” if they involve gaming or unlawful activity under federal or state
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law. 7 U.S.C. § 7a-2(c)(5)(C)(i). When the CFTC makes such a determination, the CEA expressly
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prohibits those contracts. Id. § 7a-2(c)(5)(C)(ii). Here, the CFTC made such a determination when
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it promulgated 17 C.F.R. § 40.11(a)(1), wherein it categorically prohibited event contracts that
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6 Further, under Robinhood’s theory, simply calling a sports wager a “swap”—regardless of whether it is, actually, a valid “swap”—and listing it for trade on a DCM automatically grants the CFTC exclusive jurisdiction, to the detriment of all other regulatory authorities. What, then, would limit Robinhood or any other CFTC-registered entity from simply calling “contracts” on other traditional forms of gaming—such as roulette and lotteries—“swaps” and subjecting them to the exclusive jurisdiction of the CFTC? According to Robinhood, CFTC inaction—despite the CFTC categorically banning “gaming” contracts via 17 C.F.R. § 40.11(a)—is all that is required to bless contracts blatantly designed for no other purpose than to enable gambling. See ECF No. 7 at 18; see also Complaint, at 3, ¶ 4, Blue Lake Rancheria v. Kalshi Inc. , No. 3:25-cv-06162-JSC (N.D. Cal. July 22, 2025) (displaying Kalshi advertisements touting itself as “The First Nationwide Legal Sports Betting Platform”).
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