Kalshi sports contracts dispute heads to Supreme Court

New Jersey has asked the U.S. Supreme Court to decide whether federal derivatives law prevents states from regulating sports contracts offered by CFTC-registered prediction markets. Summary New Jersey filed its Supreme Court petition on Sept. 2 after losing its case against Kalshi in the Third Circuit. The state says Dodd-Frank did not remove its authority to regulate sports wagering within its borders. Conflicting Third and Ninth Circuit decisions have created opposing rules for prediction markets in different states. Kalshi maintains that the CFTC’s exclusive jurisdiction over its registered exchange overrides state gambling laws. A Sept. 2 court filing shows that New Jersey has petitioned the Supreme Court for a writ of certiorari, asking the justices to review a Third U.S. Circuit Court of Appeals decision that favored Kalshi. The petition asks whether the Dodd-Frank Wall Street Reform and Consumer Protection Act prevents states from applying their sports-gambling laws to bets made within their borders when the contracts are offered on a market registered with the Commodity Futures Trading Commission. Kalshi operates a designated contract market overseen by the CFTC. The compan...