Kalshi Files Brief Asserting Federal Preemption Over Washington State Gambling Laws

Kalshi submits supplementary letter to Fourth Circuit, arguing CEA preempts state gambling statutes and CFTC holds exclusive jurisdiction over its DCM contracts.

Woofun AI reports that prediction market platform Kalshi filed a supplementary brief with the U.S. Fourth Circuit Court of Appeals on August 7, addressing a recent ruling by a Washington state court. The submission argues that the Commodity Exchange Act supersedes Washington's gambling regulations, asserting that state laws cannot govern contracts traded on its Designated Contract Market. Kalshi emphasizes that the CEA grants the CFTC exclusive jurisdiction based on explicit, territorial, and conflict-of-law priorities, warning that state-imposed geographic restrictions would fragment the national market. The brief also challenges the state court's interpretation of 'special rules,' maintaining that only the CFTC can determine if a contract serves the public interest. This follows a King County Superior Court decision granting an initial injunction against Kalshi, which classified its operations as illegal gambling under state law.