Event contract company Kalshi has filed a third lawsuit against a state regulator, this time taking Maryland Lottery and Gaming to court.
Filed in the Maryland District Court, Kalshi offered up the same arguments it has in pending cases in New Jersey and Nevada. The firm once again argued that the Commodities Futures Trading Commission (CFTC) has exclusive rights to regulate event contracts such as the contracts Kalshi is offering on a growing number of single-game sporting events. Kalshi again invoked the Supremacy Clause and argued that the powers conferred to the CFTC by the Commodity Exchange Act (CEA) trump a state’s laws regulating sports wagering.
Kalshi asked Maryland to wait until NV case resolved
The suit noted that the CFTC has declined to take action on sports event contracts, but did not note that there is a round table hosted by the CFTC on the topic scheduled for the end of this month.
In its filing, Kalshi noted an attempt to broker a deal with Maryland Lottery and Gaming regarding the cease and desist the organization sent to the company earlier this month.
In an April 21 email Kalshi suggested that, with a Nevada court granting a preliminary injunction to keep it online, it would be prudent to delay enforcing the cease and desist until that case is resolved. Maryland Lottery and Gaming Managing Director of Gaming and Regulatory Oversight Michael Eaton responded, reiterating the April 22 deadline to comply was still in effect.
Rather than comply, Kalshi filed suit.
No suits in Ohio or Illinois yet
As mentioned, the Nevada court granted an injunction keeping Kalshi online in the state while case was pending. Meanwhile, New Jersey has filed its response in the case this week and a ruling from the judge on an injunction there is pending.
In addition to these lawsuits at the state level, Kalshi also has pending litigation with the CFTC itself. The case regarding the legality of election event contracts currently sits in the D.C. Circuit Court of Appeals.
Illinois and Ohio have also issued cease and desist letters to Kalshi but there are currently no pending lawsuits in either district court. The Ohio cease and desist had an enforcement date of April 15, but the Ohio Casino Control Commission confirmed to SBC Americas that the deadline to comply was extended to May 15.
