Case 1:25-cv-01283-ABA Document 26 Filed 05/09/25 Page 17 of 36
In actuality , the CFTC’s exclusive jurisdiction covers just two types of transactions:
commodity futures and swaps. See 7 U.S.C. § 2(a)(1)(A) (covering certain accounts, agreements,
and transactions “involving swaps or contracts of sale of a commodity for future delivery” traded
or executed on a DCM or swap execution facility). Thus, as a threshold issue, and for the CFTC’s
exclusive jurisdiction to apply, Kalshi’s gaming devices must either be (1) commodity futures or
(2) swaps. They are neither. Because the CFTC does not have “exclusive jurisdiction” over these
gaming devices, any preemption argument is irrelevant and Maryland may regulate these
transactions under its laws. Id.
1. Kalshi’s Gaming Devices Are Not Commod ity Futures .
A “contract of sale of a commodity for future delivery” is expressly defined by the CEA ;
See 7 U.S.C. § 1a(13).
i t is an agreement to sell “a commodity” that can be delivered.
“Commodity” includes “goods,” “articles,” “services, rights, and interests … in which contracts
for future delivery are presently or in the future dealt in.” Id. § 1a(9). Such commodity futures are
the CEA’s core concern – “purchases and sales of contracts for delivery at some future date of
certain quantities of specified commodities at fixed prices.”
S. Rep. No. 93-1131, 1974
U.S.C.C.A.N. 5843, 5856 (1974) . Kalshi’s gaming devices do not fit within this core concern or
ordinary meaning of the text because t he outcome of a sports game is not a “good,” “article,”
“service,” “right,” or “interest” that can be “delivered” by a contract. The District Court of Nevada
appeared to sug gest that the outcome of a sports game or election might qualify as an “excluded
commodity,” which covers “an occurrence, extent of an occurrence, or contingency ... that is ...
beyond the control of the parties to the relevant contract, agreement, or transaction; and ...
associated with a financial, commercial, or economic consequence.” 7 U.S.C. § 1a(19)(iv); see
Hendrick , 2025 WL 1073495, at *3, *5 (D. Nev. Apr. 9, 2025). Even assuming that the Nevada
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