Case 1:25-cv-12578-RGS Document 41-1 Filed 10/16/25 Page 4 of 24
contracts, including those that involve gaming and other activity that is unlawful under federal or state law. Id. Shortly after Congress enacted the Special Rule, the CFTC adopted implementing regulations, whereby it exercised such discretion and explicitly prohibited the listing and trading of any event contract that “involves, relates to, or references … gaming, or an activity that is unlawful under any State or Federal law.” 17 C.F.R. § 40.11(a)(1); see also 76 Fed. Reg. 44,776 (July 27, 2011). Thus, in promulgating § 40.11(a)(1), the CFTC made the categorical determination that event contracts involving these specific activities are contrary to the public interest. 2 Robinhood’s sports betting operation rests entirely on an assumption that Kalshi, upon whose exchange Robinhood “facilitates” sports event contracts, has the preemptive authority to self-certify that its gaming activities do not violate the CEA, CFTC regulations, IGRA, or other federal statutes. But it is inconceivable that Congress would have granted a private, for-profit entity the authority to conduct nationwide sports betting—including on Indian lands—without explicitly stating as much, especially in the face of comprehensive statutes and regulations governing gaming on Indian lands. It is axiomatic that “Congress … does not alter the fundamental details of a regulatory scheme in vague terms or ancillary provisions—it does not,
2 When announcing its rule, the CFTC clarified:
[I]ts prohibition of…“gaming” contracts is consistent with Congress’s intent [for the CEA’s Special Rule] to “prevent gambling through the futures markets” and to “protect the public interest from gaming and other events contracts.”
76 Fed. Reg. at 44,786 (citations omitted).
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