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A coalition of 39 states and the District of Columbia has asked the U.S. Supreme Court to hear New Jersey’s case against KalshiEX LLC, arguing the justices need to resolve growing confusion over whether federal commodities law can override state gambling regulation.
According to an amicus brief summarized by VitalLaw, the states are backing New Jersey’s certiorari petition in Flaherty v. KalshiEX LLC, No. 26-299. The dispute centers on whether the Commodity Exchange Act’s exclusive-jurisdiction provision preempts state gambling laws when states try to restrict sports-related event contracts.
No West Virginia-specific change was reported in the source. But the case could matter broadly to states that want to preserve authority over gambling activity within their borders.
States say lower courts are split on Kalshi contracts
The brief argues that federal and state courts are “hopelessly confused” on the preemption question and says Supreme Court review is needed before the conflict deepens.
The Third Circuit previously upheld an injunction in Kalshi’s favor, finding New Jersey’s gambling laws directly interfered with the company’s sports-event contracts. But other courts have gone the other way.
VitalLaw said the Ninth Circuit ruled against Kalshi, finding the Commodity Exchange Act likely did not preempt Nevada law because the contracts are not swaps. The Sixth Circuit likewise held the contracts are not swaps and that the federal law does not expressly or impliedly preempt Ohio’s or Tennessee’s gambling laws.
The brief asks the Supreme Court to resolve that circuit split and clarify the scope of the Commodity Futures Trading Commission’s authority.
What happens next in the Supreme Court fight
The immediate question is whether the Supreme Court will grant New Jersey’s petition and take up the case. If it does, the justices would be positioned to answer a core issue for both regulators and operators: whether states can continue to enforce their own gambling laws against sports-related event contracts that may also fall under federal commodities oversight.
More rulings could still arrive elsewhere before that happens. VitalLaw noted that decisions are still pending in the Second, Fourth, Seventh, Eighth, and Tenth Circuits, as well as in Massachusetts’ highest court.
For now, the main development is procedural but significant: a large multistate coalition is telling the Supreme Court that the disagreement among lower courts is serious enough to require a national answer.
More from playwv.com – Prediction market firms push back on CFTC affiliate trading proposal – West Virginia Named Among States With Online Gambling Frameworks in New US Rules Analysis – Supreme Court’s first docket leaves prediction market cases waiting
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Source: As reported by Rebecca E. Hoffman, J.D..
