WASHINGTON, D.C.—Stephen Hall, Legal Director and Securities Specialist, issued the following statement on the filing of an amicus brief in support of the Maryland Gaming Commission as it fights to preserve state protections for those who wager on sports, in KalshiEX LLC v. Martin, No. 25-1892 (4th Cir.):

“KalshiEX LLC (‘Kalshi’) is attempting to evade the consumer protections that Maryland and many other states have established to mitigate the financial harm and other hardships that often come with sports betting. Kalshi claims that its sportsbook—which is no different from other familiar sports betting platforms—offers derivatives contracts under the exclusive oversight of the Commodity Futures Trading Commission (‘CFTC’). But Congress never intended the derivatives markets to become a safe haven for sports books seeking immunity from state regulation, nor did it intend to preempt or nullify state laws applicable to gaming.

“The federal district court in Maryland rightly rejected Kalshi’s arguments, and the appellate court has ample grounds for affirming that decision. As we argued in our brief, Kalshi’s sports wagers are not even the type of financial instrument, known as swaps, that could possibly be eligible for exclusive regulation under the Commodity Exchange Act. Moreover, the CFTC actually banned these gaming contracts over a decade ago.

“A decision in favor of Kalshi would deprive Maryland’s citizens of important consumer protections, threaten the viability of state laws that prohibit gambling on elections, and turn the CFTC into the nation’s gaming commissioner and election supervisor—roles that the agency plainly lacks the expertise, resources, or legislative mandate to perform. Such a decision would also divert the agency’s scarce resources away from its core mission of regulating the bona fide derivatives markets. Americans depend on those markets for stable prices in the essential goods they rely on in everyday life, from gasoline to groceries. The Fourth Circuit can help prevent these outcomes and also set a valuable precedent that guides other courts in similar cases.”

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