2:25-cv-575-APG-BNW MOTION HEARING - ROUGH DRAFT - DO NOT CITE!!!
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to challenge that decision?
MR. HAVEMANN: But the key point is that that would be a challenge under Federal law to a decision of a Federal agency. It would not be the Board attempting to enforce State law against an entity that is a designated contract market because that is what is preempted. THE COURT: Okay. MR. HAVEMANN: And just to back out and broaden the scope of what we're looking at, the statute, as you noted, 7 U.S.C. Section 2(a)(1), says that the Commission shall have exclusive jurisdiction with respect to these agreements, with respect to swaps, contracts for sale, on designated contract markets. So Congress is clear that with respect -- once the CFTC made the decision to designate a particular exchange as a contract market, that's what subjects the contracts on that exchange to the exclusive jurisdiction of the CFTC. If it's not designated as a contract market, then it is still left to the enforcement mechanisms of the different states. That is the line that Congress drew in the 1974 amendments between what would be subject to Federal authority and what would be subject to State authority. And I know Your Honor indicated that it read our reply, but I think that maybe a basic misunderstanding between us and the defendants in this case is, I think the defendants understand Kalshi to be arguing that the CEA preempts all State gaming laws, and that's not
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UNITED STATES DISTRICT COURT Judy K. Moore, RMR, CRR
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