Case: 25-1922 Document: 73 Page: 20 Date Filed: 08/14/2025
2194908, at *8. This insight is supported by cases that Kalshi miscites, which recognize that a federal law’s contemplation of parallel state law (rather than state enforcement of federal law) 7 demonstrates that Con- gress did not intend to occupy the field to the exclusion of all state law. Compare Appellee Br. 57–58, with Just Puppies, Inc. v. Brown , 123 F.4th 652, 662 (4th Cir. 2024), and Pueblo of Pojoaque v. New Mexico , 863 F.3d 1226, 1236 (10th Cir. 2017). Remarkably, Kalshi doubles down on turning the CFTC into the final arbiter of state law. In Kalshi’s world, the CFTC’s construction of state laws that might apply—from criminal law to election law to sports wagering—would become authoritative because the CFTC alone can en- force them. That result would be bizarre, giving a federal agency respon- sible for U.S. derivatives markets greater law-interpreting power than even federal courts. Contra Pinho v. Gonzales , 432 F.3d 193, 212 (3d Cir. 2005). Kalshi makes no attempt to square that result with precedent or common sense, instead contending that “[f]ederal agencies routinely in- terpret state law.” Appellee Br. 58. But there is massive gulf between a 7 For that reason, Kalshi places undue emphasis (at 57) on the Act’s state-enforcement mechanism. See 7 U.S.C. § 13a-2(1). Authorizing States to enforce the federal law against persons “other than a contract market, derivatives transaction execution facility, clearinghouse, floor broker, or floor trader” says nothing about how States may enforce their own laws. It also makes sense that the CFTC would not need assistance enforcing the Act against persons and entities—like contract markets and floor brokers—in the heartland of its regulation.
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