Ohio, 38 Other States, D.C. Urge Supreme Court to Hear Kalshi Case

Ohio, joined by 38 other states and the District of Columbia, filed an amicus curiae brief with the U.S. Supreme Court on 7 октября 2026, urging the Court to grant New Jersey’s petition for review of a Third Circuit decision holding that the Commodity Exchange Act preempts state sports-gambling laws as applied to Kalshi’s sports event contracts.

The filing supports the petitioners in Mary Jo Flaherty, Interim Director of the New Jersey Division of Gaming Enforcement, et al. v. KalshiEX, LLC, No. 26-299. The Court’s public docket shows New Jersey filed its petition for a writ of certiorari on 2 сентября 2026, after Justice Alito twice granted extensions of the filing deadline, and the case was docketed on 8 сентября 2026. The petition challenges the Third Circuit’s 6 апреля 2026 ruling.

Ohio Solicitor General Mathura J. Sridharan is counsel of record for the amici states, and Ohio Attorney General D. Andrew Wilson signed the brief. Jeremy Michael Feigenbaum of the New Jersey Attorney General’s office is counsel of record for the petitioners, and Neal Kumar Katyal of Milbank LLP represents KalshiEX.

The States’ Argument

The states ask the Court to reject what their brief describes as a two-step theory advanced by prediction markets, companies that operate as federally regulated exchanges and began offering sports bets about two years ago. Under that theory, the brief states, sports bets are “swaps” traded on a designated contract market, a CFTC-regulated exchange, and the Commodity Exchange Act’s exclusive-jurisdiction provision then displaces state law.

The brief recounts that the Dodd-Frank Act of 2010 extended the Commodity Futures Trading Commission’s exclusive jurisdiction to swaps, while leaving two saving clauses that preserve the jurisdiction of other regulatory authorities and of federal and state courts. The statute’s six-part swap definition covers agreements dependent on the occurrence of an event associated with a potential financial, economic, or commercial consequence, according to the brief.

Kalshi began offering sports bets on 22 января 2025, after certifying to the CFTC that the products would be offered on its designated contract market in compliance with federal law, the brief states.

The states frame gambling regulation as a traditional state police power, pointing to the Court’s 2018 decision in Murphy v. NCAA, which reaffirmed state authority over sports gambling. Utah prohibits sports gambling while Ohio legalizes and regulates it, the brief notes, and the states argue the preemption theory threatens the licensing systems, exclusion lists, minimum-age rules and spending limits they have built.

The Federal Appellate Split

The Third Circuit issued the first federal appellate decision on the question and affirmed a preliminary injunction granted to Kalshi, the brief recounts. A divided panel held that Kalshi’s sports-related event contracts are swaps and that the federal law imposes both field and conflict preemption on state laws regulating such contracts on CFTC-licensed exchanges.

Judge Roth dissented, writing that the prediction-market bets were “virtually indistinguishable from the betting products available on online sportsbooks” and rejecting what she termed an alchemy that transmutes sports gambling into futures trading, according to the brief.

A unanimous Ninth Circuit panel ruled on 28 августа 2026, in KalshiEX v. Assad that the exclusive-jurisdiction clause expressly preempts state law but that sports bets are not swaps, so the Act does not preempt state gambling laws. On 25 сентября 2026, a unanimous Sixth Circuit panel held in KalshiEX v. Schuler that the contracts are not swaps and that the provision supplies neither express, field, nor conflict preemption.

Related cases remain pending at the Second, Fourth, Seventh, Eighth and Tenth Circuits and the Massachusetts Supreme Judicial Court, the brief states, with the Fourth Circuit case argued on 7 мая 2026, and the Massachusetts case argued on 4 мая 2026. A second petition, brought by North American Derivatives Exchange, doing business as Crypto.com Derivatives North America, in its dispute with Nevada is before the Court as No. 26-344, and Kalshi sought en banc review from the Ninth Circuit on 9 сентября 2026. Citing New Jersey’s petition, the brief states that courts have issued more than 20 decisions on the question, dividing 18-4 against preemption.

The CFTC’s Role in the Dispute

The brief recounts that the CFTC stated in a 10 июня 2024 Federal Register notice that gambling in the United States is overseen by state regulators, and that the agency remained neutral in a 30 сентября 2025 staff letter. Under new leadership, the commission has since endorsed the prediction markets’ position, filing amicus briefs in multiple cases and suing at least nine states (Arizona, Connecticut, Illinois, Kentucky, Minnesota, New Mexico, New York, Rhode Island and Wisconsin) to stop them from enforcing their sports-gambling laws, according to the brief.

The commission also issued a proposed rulemaking on 12 июня 2026, that would permit sports bets on federal markets, which the brief describes as a departure from the agency’s prior position and its existing rule barring gaming on designated contract markets. Forty-four states opposed the proposal in a 27 июля 2026 comment letter, arguing the commission lacks the power to preempt state law, the brief states.

New York’s attorney general filed an enforcement action against Kalshi in state court, announced on 31 июля 2026, and days later, on 11 августа 2026, the CFTC ordered Kalshi to continue exercising its designated-contract-market functions, the brief recounts. In that announcement, the CFTC chairman criticized New York’s gaming laws and said states have “no business regulating these interstate financial markets,” according to the brief.

The filing extends a series of multi-state coalitions in the dispute: earlier amicus briefs drew 34 states, the District of Columbia and the Northern Mariana Islands in the Third Circuit; 37 states and the District of Columbia in the Massachusetts Supreme Judicial Court; 38 states and the District of Columbia in the Fourth Circuit; and 39 states and the District of Columbia in the Sixth and Ninth Circuits, according to the brief.

The docket also lists amicus briefs supporting the petition from the National Council of Legislators from Gaming States, filed 22 сентября 2026; the International Association of Gaming Regulators and the North American Gaming Regulators Association, filed 2 октября 2026; the Cabazon Band of Cahuilla Indians, filed 6 октября 2026; Stop Predatory Gambling, the Association of American Physicians and Surgeons and Texans Against Gambling, filed 7 октября 2026; and the National Football League, filed 8 октября 2026.

Kalshi’s response to the petition, originally due 8 октября 2026, is due 9 ноября 2026, after the Court granted an extension on 22 сентября 2026.