Attorney slams Ninth Circuit ruling that sports event contracts escape CFTC oversight
The Ninth Circuit Court of Appeals ruled that sports-related event contracts are not swaps, contradicting a Third Circuit decision and creating a circuit split on how federal derivatives law classifies such contracts. Attorney Ariel Givner criticized the ruling on X, arguing that sports event contracts listed on a designated contract market are derivatives and that CFTC oversight should replace 50 separate state regimes.
The circuit split gives Kalshi a narrow path to Supreme Court review, but that timeline stretches years. Until then, the Ninth Circuit loss emboldens state attorneys general who have already sued or blocked Kalshi in Nevada, Michigan, Washington, Connecticut, New York, Wisconsin, and Utah. Each state victory fragments the national market further and forces Kalshi toward costly geofencing or voided contracts.
Polymarket and Novig face identical exposure, yet Kalshi's higher profile makes it the test case states target first. Traders now hold contracts whose validity depends on geography rather than federal designation. Legal spend multiplies across parallel dockets while the preemption shield that justified Kalshi's national launch keeps eroding. A second circuit loss would trigger copycat filings and accelerate the fragmentation.