CFTC urges Sixth Circuit to overturn Ohio ruling

The Commodity Futures Trading Commission filed an amicus brief Tuesday in the U.S. Court of Appeals for the Sixth Circuit asking the court to overturn a federal district court ruling in Ohio that narrowed the agency’s jurisdiction in a 2025 complaint against Kalshi.

The brief contends the U.S. District Court for the Southern District of Ohio adopted too narrow a view when Chief Judge Sarah D. Morrison denied Kalshi’s request for a preliminary injunction in March. Ohio’s complaint, brought by federal state officials including Ohio Casino Control Commission Executive Director Matthew Schuler, alleges Kalshi’s contracts operate as unlicensed sports wagers under state law.

CFTC Chair Michael Selig wrote in a statement: “The federal district court in Ohio took an improperly narrow view of the Commission’s jurisdiction, and we are asking the Court of Appeals to correct that error.” He added the agency will not allow states to undermine its authority over prediction markets and said a federal regulator is needed because many contracts cross state lines.

The agency has proposed rulemaking to clarify its oversight of prediction markets and in recent months has sued Wisconsin, Illinois, Arizona, Connecticut and New York over enforcement actions or regulatory challenges tied to these platforms.

State officials and attorneys general have challenged the CFTC’s approach. New York Attorney General Letitia James and 37 other attorneys general filed an amicus brief supporting Massachusetts’ lawsuit against Kalshi, arguing prediction markets must comply with state gambling laws designed to protect consumers and that sports-related contracts may violate local wagering bans.

Kalshi operates an online exchange that lets users buy and sell contracts tied to future events. The outcome of the Sixth Circuit appeal could determine whether the CFTC’s statutory authority covers these platforms or whether states can enforce their own gambling laws against them.

The Ohio complaint and related cases are part of ongoing litigation over whether event-based contracts should be regulated at the federal level by the CFTC or by state gambling authorities. The appeals court’s decision will resolve whether the district court’s interpretation of the commission’s jurisdiction stands or must be revised.