Case 1:25-cv-01283-ABA Document 29 Filed 05/19/25 Page 14 of 17
patchwork of state regulation that Congress created the CFTC to avoid. 4. The presumption against preemption does not apply . Defendants fall back on the presumption against preemption. But the presumption does not apply to the field of regulating derivatives markets—“an area where there has been a history of significant federal presence.” PPL EnergyPlus, LLC v. Nazarian , 753 F.3d 467, 477 (4th Cir. 2014). The presumption is particularly inapposite given that the CEA does not preempt state gambling laws in all applications, but merely as applied to the narrow field of trading on DCMs, which has always been the subject of federal rather than state authority. Even if the presumption applied, it is “overcome” where “the text and structure” of the relevant federal statute “unambiguously apportion[] control” over the field to the federal agency. Id. Congress’s intent to preempt state laws through the CEA is clear for all the reasons already noted. Defendants’ reliance on the presumption against preemption is especially untenable given the breadth of their argument. While this case arises in the context of state gambling laws, Defendants’ interpretation of the CEA (at 24) would mean that states may regulate any event contracts traded on DCMs that fall within their “traditional police powers.” No limiting principle confines their argument to gambling laws, and their interpretation would result in a radical revision of the CEA—yet another reason to reject it. B. Kalshi Will Suffer Irreparable Harm Without A Preliminary Injunction. As the Districts of Nevada and New Jersey concluded, “Kalshi has met its burden of showing a likelihood of irreparable harm.” Hendrick , 2025 WL 1073495, at *7; see also Flaherty , 2025 WL 1218313, at *7. Defendants’ cease-and-desist letter threatens Kalshi with a Hobson’s choice: It must either continue offering its contracts in Maryland and “expose [itself] to potentially huge liability,” or “suffer the injury of obeying the law during the pendency of the proceedings” and risk irreparable costs, the potential loss of its CFTC designation, and
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