Case 1:25-cv-01283-ABA Document 26 Filed 05/09/25 Page 34 of 36
Regulation 40.11(a)(1) instructing Kalshi not to list contracts involving gaming on its registered
market. See ECF 2 at 5, 6.
Kalshi now cries crocodile tears and exclaims that it is being forced into “a Hobson’s
Choice” by the Cease and Desist letter. ECF 2 at 17-19. However, it was Kalshi affirmative act
of self-certifying gaming devices clearly prohibited by Regulation 40.11(a)(1) that created
Kalshi’s current dilemma , and any harm resulting from that act lies squarely on Kalsh i’s shoulders.
As further evidence of this self-imposed harm, Kalshi acknowledges that “[t]he CTFC had initiated
its 90- day review period of [NADEX/crypto.com’s] sports related contracts on January 14, 2025”
and “requested NADEX/crypto.com suspend its sports -related contracts during the pendency of
that review.” ECF 1 at ¶ 50 (emphasis added). Despite thi s, Kalshi self-certified its own sports-
related contracts on January 22, 2025, eight days after the CFTC requested that
NADEX/crypto.com suspend its listing of similar contracts. Exhibit 2 at 4.
Kalshi’s certification of its gaming devices constituted mi sconduct “directly related to the
subject of th[is] suit. ” Smith , 124 F.R.D. at 106. This Court should close “ the doors of a court of
equity to one tainted with inequitableness or bad faith relative to the matter in which he seeks
relief” by dismissing Kalshi request for injunctive relief. Smith , 124 F.R.D. at 105 – 06 (quoting
Precision Instrument Manufacturing Co. v. Automotive Maintenance Machinery Co., 324 U.S.
806, 814 – 15, (1945) and citing 1 J. Pomeroy, A Treatise on Equity Jurisprudence section 397, at
738 (4th ed. 1918)).
III. T HE B ALANCE OF THE H ARDSHIPS IN T HIS M ATTER F AVORS THE P ROTECTION OF M ARYLAND ’ S C ITIZENS AND B USINESSES .
“When a plaintiff seeks preliminary injunctive relief against the Governme nt, the balance
of the equities and the public interest factors merge.” Coreas v. Bounds , 451 F. Supp. 3d 407, 429
(D. Md. 2020) (citing Nken v. Holder , 556 U.S. 418, 435 (2009) and Roe v. Department of Def. ,
28
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