Case 1:25-cv-01283-ABA Document 26 Filed 05/09/25 Page 2 of 36
TABLE OF CONTENTS
Page
Introduction ......................................................................................................................................1
Background ......................................................................................................................................2
I. Kalshi’s Gaming Devices Are Sports Wagering. ................................................................2
II. Maryland Regulates Sports Wagering to Protect the Public Interest ……………………… 3
III. The Commodity Futures Trading Commission Regulates Commodity Futures and Swaps, Not Sports Wagering. ..............................................................................................5
IV. Maryland Directs Kalshi to Cease and Desist Unlicensed Sports Wagering.......................8
Standard of Review..........................................................................................................................9
Argument ......................................................................................................................................... 9
I. Kalshi Is Unlikely to Prevail on the Merits Because Its Gaming Devices Are Not Within the Exclusive Jurisdiction of the CFTC. ................................................................10
A. Kalshi’s Illegal Gaming Devices Are Outside of the C FTC ’s Ex clusive Jurisdiction Because They Are Not Commodity Futures or Swaps. ...........................10
1. Kalshi’s Gaming Devices Are Not Commodity Futures. ......................................11
2. Kalshi’s Gaming Devices Are Not Swaps Within the Ordinary Meaning of 11 the CEA, Canons of Statutory Interpretation, or the CEA’s Legislative History....................................................................................................................12
a. Kalshi's Gaming Devices Are Unrelated to Any Potential Financial, Economic, Or Commercial Consequence .......................................................12
b. Gaming Devices Cannot Be “Swaps” Under Numerous Canons of Statutory Interpretation. ...................................................................................15
c. Legislative History Confirms that Sports Gaming Contracts Are Not Swaps ...............................................................................................................18
B. The CTFC Has Expressly Prohibited Gaming Devices from Being Offered on a DCM..........................................................................................................................20
1. § 40.11 Prohibits Listing any Contract Involving Gaming....................................21
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