Case: 25-7504, 01/16/2026, DktEntry: 38.1, Page 36 of 47
That argument stretches the statutory text past its breaking point. As a district court in this Circuit recently explained, Kalshi’s sports contracts are not “associated with a potential financial, economic, or commercial consequences within the CEA’s meaning.” Hendrick , 2025 WL 3286282, at *9. Instead, that phrase more naturally connotes an “event or contingency [that] itself has some potential financial, eco- nomic, or commercial consequence without looking at externalities like potential downstream financial consequences such as parties extrinsic to the event betting on it.” Id. at *6 (emphasis added; footnote omitted). As that same court explained, Kalshi’s reading also fails because sports wagers do not turn on the “occurrence” or “nonoccurrence” of an event ( e.g. , whether a sporting event takes place), but instead depend on the result of an event that has occurred. Id. at *6; accord N. Am. Derivatives Exch., Inc. v. Nev. Gaming Control Bd. , No. 2:25-cv-978, 2025 WL 2916151, at *7-9 (D. Nev. Oct. 14, 2025). Kalshi’s interpretation also creates serious surplusage problems. See, e.g., Duncan v. Walker , 533 U.S. 167, 174 (2001) (explaining the canon against surplusage). The CEA offers six alternative definitions of the term “swap.” See 7 U.S.C. § 1a(47)(A). But “if everything a person
28
Made with FlippingBook - Online catalogs