Case 1:25-cv-14723 Document 1 Filed 08/19/25 Page 9 of 28 PageID: 9
accounts, agreements (including any transaction which is of the character of, or is commonly known to the trade as, an ‘option’, ‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’), and transactions involving swaps or contracts of sale of a commodity for future delivery (including significant price discovery contracts), traded or executed on a contract market designated pursuant to section 7 of this title . . . .” 7 U.S.C. § 2(a)(1)(A) (emphasis added). The CEA expressly preserves state authority to regulate transactions “not conducted on or subject to the rules” of a CFTC-regulated exchange. Id. § 16(e)(1)(B)(i). 26. To receive the CFTC’s designation as a contract market, an exchange must apply and set forth its ability to comply with CFTC rules and regulations. Id. §§ 2(e), 7(a); 17 C.F.R. § 38.3(a). The CFTC’s comprehensive regulatory framework for contract markets, including a set of 23 “Core Principles,” 17 C.F.R. pt. 38, is designed to ensure and protect the integrity of those markets. Status as a CFTC-designated contract market “imposes upon [an exchange] a duty of self-regulation, subject to the Commission’s oversight,” requiring the exchange to “enact and enforce rules to ensure fair and orderly trading, including rules designed to prevent price manipulation, cornering and other market disturbances.” Am. Agric. Movement, Inc. , 977 F.2d at 1150-51. The CFTC is authorized to suspend or revoke an exchange’s designation if it fails to comply with any of the provisions of the CEA or the CFTC’s regulations. 7 U.S.C. § 8(b). 27. An exchange may submit new contracts to the CFTC for approval prior to listing; alternatively, it may self-certify the contracts as complying with CFTC requirements. 7 U.S.C. § 7a-2(c)(1), (4)(A); 17 C.F.R. §§ 40.2(a), 40.3(a), 40.11(c). Generally, the CFTC “shall
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