Case 1:25-cv-12578-RGS Document 1 Filed 09/15/25 Page 14 of 28
Kalshi’s customers or indirectly to Kalshi from Robinhood’s customers—are subject to the
CFTC’s exclusive jurisdiction, and Massachusetts law is preempted to the extent it purports to
regulate those transactions.
39.
The Constitution and laws of the United States “shall be the supreme Law
of the Land,” U.S. Const. art. VI, cl. 2, and accordingly, “Congress has the power to preempt
state law.” Crosby v. Nat. Foreign Trade Council , 530 U.S. 363, 372 (2000). Federal law can
preempt state law expressly, through a statement to that effect in the statute itself, or impliedly,
through either field preemption or conflict preemption. Field preemption exists where Congress
manifests an intent to occupy exclusively an entire field of regulation. See Fidelity Fed. Sav. &
Loan Ass’n v. De la Cuesta , 458 U.S. 141, 153 (1982). Conflict preemption exists where
compliance with federal and state law is “a physical impossibility” or when “state law stands as
an obstacle to the accomplishment and execution of the full purposes and objectives of
Congress.” Id. (internal quotation omitted).
40.
The statutory language of the CEA, its legislative history and the
comprehensive regulatory framework it sets out demonstrate that Congress deliberately
preempted state law. Whether analyzed as express or implied preemption, the scope of
preemption is the field of commodity futures and swaps trading, including event contract trading,
on CFTC-designated exchanges.
41.
The CEA provides expressly that the CFTC “shall have exclusive
jurisdiction” over commodity futures and swaps trading on CFTC-designated exchanges. 7
U.S.C. § 2(a)(1)(A). Express provisions of this type are regularly held to preempt state law. See,
e.g. , BNSF Ry. Co. v. Cal. Dep’t of Tax & Fee Admin. , 904 F.3d 755, 765-66 (9th Cir. 2018)
(describing statute’s grant of “exclusive” jurisdiction as a “broad and general” preemption
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