Arkansas v. Kalshi Escalates: Justice Department and CFTC File Federal Lawsuit
The U.S. Department of Justice and the Commodity Futures Trading Commission filed suit on November 12 in the U.S. District Court for the Eastern District of Arkansas, seeking to block Arkansas's enforcement action against prediction market platform Kalshi, as the jurisdictional fight between the state and the federal government over prediction markets escalated further. The federal complaint notes that Arkansas Attorney General Tim Griffin sued Kalshi on November 4 in Independence County Circuit Court, accusing it of operating an illegal gambling platform in violation of the Arkansas Deceptive Trade Practices Act and of unjust enrichment.
The Justice Department and the CFTC argue that the federal Commodity Exchange Act gives the CFTC exclusive jurisdiction over derivatives markets, so state law is preempted by federal law and cannot be used to regulate a federally regulated prediction market platform. The federal suit asks the court for declaratory relief and preliminary and permanent injunctions covering Arkansas law and related investigations. The complaint also warns that, calculated per violation, fines could reach into the hundreds of millions of dollars. The case is being heard by U.S. District Judge Brian Miller; until the court rules, Arkansas's suit in Independence County continues, and Kalshi itself is not a defendant in the federal case.
Related: Arkansas Attorney General Sues Prediction Market Kalshi, Alleging Illegal Gambling
Source: U.S. Department of Justice
Published by GSM · USA (original Chinese edition)
Photo: 美国商品期货交易委员会总部。／Headquarters of the U.S. Commodity Futures Trading Commission.（美国联邦政府，公共领域）
