Case 2:26-cv-00151 Document 1 Filed 02/23/26 PageID.8 Page 8 of 27
them while causing “market fragmentation [that] erode[s] the nationally uniform framework Congress established to reduce risk, promote transparency, and safeguard market integrity within the financial system.”); Orgel , 2026 WL 474869, at *7–10 (agreeing Kalshi’s sports event contracts satisfy the statute’s “broad” requirement that an event have a “ potential financial, economic, or commercial consequence.”). 17. Utah state laws contemplate criminal charges for unlawful gaming transactions, and Defendants’ recent statements make abundantly clear that they think Kalshi’s event contracts fall within that category. Since those statements, Defendants have not engaged with Kalshi to provide any assurances about whether they will enforce those laws against it. 18. Defendants’ statements and conduct leaves little doubt that Defendants intend to bring an enforcement against Kalshi unless Kalshi stops offering contracts entirely—which, again, are offered for trade on its federally regulated exchange without objection from the CFTC—in Utah. In doing so, Defendants would seek to subject Kalshi to the patchwork of state regulation that Congress created the CFTC to prevent, and Defendants would interfere with the CFTC’s exclusive authority to regulate derivatives trading on the exchanges it oversees. 19. Defendants’ anticipated actions are preempted under the Supremacy Clause of the U.S. Constitution—both because Congress has expressly and impliedly occupied the field of regulating trading on CFTC-approved exchanges, and because Defendants’ acts would squarely conflict with federal law. Kalshi is entitled to declaratory and injunctive relief to prevent Utah authorities from enforcing their preempted state laws against Kalshi. 20. Moreover, Defendants’ threatened conduct contravenes Utah’s own anti-gambling laws which exempt “lawful business transactions,” such as federally regulated transactions, from prosecution. Utah Code § 76-9-1401(8)(c)(i).
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