Case 2:26-cv-00151 Document 1 Filed 02/23/26 PageID.4 Page 4 of 27
insofar as futures regulation is concerned.” H.R. Rep. No. 93-1383, at 35 (1974) (Conf. Rep.). And the statute gives the CFTC comprehensive authority over regulated exchanges, including the authority to approve or reject certain categories of event contracts as against the public interest. 6. For that reason, courts have easily found that the CEA preempts state laws in similar contexts. See, e.g. , Am. Agric. Movement, Inc. v. Bd. of Trade of Chicago , 977 F.2d 1147, 1156 (7th Cir. 1992), abrogated on other grounds by Time Warner Cable v. Doyle , 66 F.3d 867, 875 n.7 (7th Cir. 1995); Bibbo v. Dean Witter Reynolds, Inc. , 151 F.3d 559, 563–64 (6th Cir. 1998). The CFTC itself agrees. It recently informed the U.S. Court of Appeals for the D.C. Circuit that, “ due to federal preemption , event contracts never violate state law when they are traded on a DCM” like Kalshi. Brief for Appellant at *27, KalshiEX LLC v. CFTC , 119 F.4th 58 (D.C. Cir. 2024) (No. 24-5205), 2024 WL 4512583 (emphasis added). 3 7. Last week, the CFTC affirmed that it has exclusive jurisdiction to regulate derivatives markets like Kalshi, and the CFTC committed to defending that authority against improper attacks from state regulators such as Utah’s. Amicus Brief of CFTC at 1, N. Am. Derivatives Exch., Inc. v. Nevada , No. 25-7187 (9th Cir. Feb. 17, 2026), Dkt. No. 38.2, at 1 (“CFTC Amicus Br.”) (“Congress vested the CFTC with exclusive jurisdiction to protect that national interest by overseeing the regulation of futures, options, and swaps traded on federally regulated exchanges…[t]he CFTC’s jurisdiction supersedes State as well as Federal agencies because commodity derivatives markets require nationally uniform rules governing the listing,
3 Commentators have likewise concluded with no difficulty that the CEA “resulted in the preemption of all other would-be regulators at every level of government.” Philip F. Johnson, The Commodity Futures Trading Commission Act: Preemption as Public Policy, 29 Vand. L. Rev. 1, 2 (1976). And commentators have specifically recognized that “the CEA preempts state bucket- shop laws and other anti-gambling legislation.” Kevin T. Van Wart, Preemption and the Commodity Exchange Act, 58 Chi.-Kent L. Rev. 657, 721 (1982).
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