NFL tells Supreme Court a 'swap' does not cover sports event contracts
In a brief filed on 8 October 2026, the league argues that sports event contracts are not swaps under federal law and that state regulators should keep oversight.
In brief
- What happened
- The NFL filed a brief on 8 October 2026 asking the US Supreme Court to hear a case over whether federal law lets Kalshi offer sports event contracts despite state law.
- Why it matters
- The Third Circuit ruled for Kalshi, while the Sixth and Ninth Circuits ruled the other way, so courts disagree on who regulates sports contracts on prediction markets.
- Who it affects
- State gaming regulators and sports leagues: the NFL says its integrity safeguards apply to state-licensed sportsbooks but not to prediction markets.
The National Football League has asked the US Supreme Court to take up a dispute over whether federal law lets Kalshi offer sports event contractsEvent contractA derivative contract whose payoff depends on a specified event, occurrence or value, for example whether it rains tomorrow or what an economic indicator will be. It is the product traded on prediction markets.Full entry in the glossary regardless of state gambling rules. The league filed an amicus brief (a brief from a party not in the case) on 8 October 2026 in Case No. 26-299, Flaherty v. KalshiEX, LLC, supporting petitioners Mary Jo Flaherty and Jennifer Davenport.
Event contracts are contracts that pay out depending on whether a stated event happens, traded on a prediction marketPrediction marketA market where people trade contracts on the outcome of future events, such as an election result, an interest rate decision or a sports game. In the United States regulated prediction markets are overseen by the Commodity Futures Trading Commission (CFTC).Full entry in the glossary. Kalshi is a federally designated contract market (DCM), according to the brief.
The details
- The question: whether the 2010 Dodd-Frank Act, by treating such contracts as "swaps", preempted (overrode) state sports-betting laws for contracts traded on DCMs.
- The ruling below: the Third Circuit held that Kalshi's sports contracts fall within the CFTC's exclusive jurisdiction over swaps, and that field preemption applies.
- The split: the brief says the Sixth Circuit (25 September 2026) and the Ninth Circuit (28 August 2026) disagreed on both points. It also cites a Ninth Circuit decision of 16 September 2026 in Blue Lake Rancheria v. Kalshi.
- The NFL's argument: read in context, "swap" does not naturally cover sports contracts, because derivatives law historically concerns hedging risk and price discovery. A broad reading also raises Commerce Clause and major-questions problems, it says.
- The NFL's volume figure: on the first Sunday of the season, $1.8 billion of $3.3 billion in total prediction-market trading volume related to the NFL, according to the brief.
- The NFL's safeguards claim: the league says it requires its legalized sportsbook partners to follow a list of prohibited wagers, and that the CFTC and DCMs have so far taken a more laissez-faire approach despite its encouragement to adopt similar safeguards.
Why it matters
The case decides who oversees sports contracts on federally registered exchanges. If they are swaps, the CFTC alone does, according to the Third Circuit's reasoning; if they are not, the swap-based argument for overriding state sports-betting law falls away, as the Sixth and Ninth Circuits held.
Until the Supreme Court acts on the petition, courts in different circuits have given opposite answers on the same question about Kalshi's sports contracts.
The big picture
A separate brief from Ohio and 38 other states and Washington, DC also asked the court to grant the petition.
What's next
The filing does not say when the court will decide whether to hear the case.
Drafted with AI assistance from the regulator's official notice and reviewed by our editors before publication. How we work