NFL tells the Supreme Court sports contracts are gambling

The National Football League told the Supreme Court on October 8, 2026 that sports-related event contracts are gambling, not swaps, and that the Dodd-Frank Act did not hand the Commodity Futures Trading Commission (CFTC) exclusive power to pre-empt state sports-betting law. The brief supports New Jersey in Flaherty v. KalshiEX, LLC, No. 26-299, a petition the Court has not granted. Kalshi's response is due on November 9, 2026.

The petition asks whether the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act pre-empted state regulation of sports bets offered on a CFTC-registered market. On April 6, 2026 the Third Circuit affirmed an injunction keeping New Jersey gaming law off Kalshi's sports contracts. The Sixth Circuit on September 25, 2026, and the Ninth Circuit on August 28, 2026, read the Commodity Exchange Act (CEA) the other way. The NFL brief says those two courts are right. On the first Sunday of the 2026 season, the league says, NFL contracts were $1.8 billion of $3.3 billion in prediction-market volume.

Key facts

• Docket No. 26-299, Mary Jo Flaherty and Jennifer Davenport v. KalshiEX, LLC. Petition filed September 2, 2026, docketed September 8, 2026. NFL amicus submitted October 8, 2026. Source: Supreme Court docket.
• Question presented: whether Dodd-Frank pre-empted states from regulating in-state sports bets offered on CFTC-registered markets. Source: petition for certiorari.
• NFL figure in the brief: on the first Sunday of this season, NFL contracts were $1.8 billion of $3.3 billion in prediction-market volume. Source: NFL amicus brief.
• CFTC figure: in 2025, volume on CFTC-registered prediction markets exceeded $25 billion, against futures notional of around $31 trillion. Source: 91 Fed. Reg. 35,806 (June 12, 2026).
• Same proposal: one large venue went from about 1,600 event contracts a day in April 2025 to about 162,000 in April 2026, with 25 designated contract markets (DCMs) then on the books. Comments were due July 27, 2026.
• New Jersey penalty in the Third Circuit opinion: a fourth-degree crime, fines up to $100,000, N.J. Stat. Ann. §§ 5:12A-11(c), 2C:43-2. Source: No. 25-1922 (April 6, 2026).

Methodology and sources

Documents were read on October 9, 2026. They are docket No. 26-299 after the October 8 filings, the NFL brief, New Jersey's September 2, 2026 petition, and the Third Circuit opinion of April 6, 2026 in No. 25-1922, affirming Judge Edward S. Kiel's preliminary injunction, D.N.J. No. 1:25-cv-02152. Also read: 91 Fed. Reg. 12,516 (March 16, 2026), 91 Fed. Reg. 35,806 (June 12, 2026), RIN 3038-AF65, the January 3, 2022 Polymarket order, Commissioner Roger Goodell's May 21, 2018 statement, and section 33 of the UK Gambling Act 2005. The $1.8 billion figure is the league's. Sixth and Ninth holdings and the 543-employee note are used as the brief cites them. The $25 billion, contract counts, 25 DCMs, and the July 27, 2026 comment deadline were checked on the Federal Register.

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What the NFL says a swap is not

KalshiEX, LLC is a DCM. A competitor listed sports in December 2024, and Kalshi followed about a month later. About two months after that, New Jersey sent a cease-and-desist calling the contracts illegal gambling, including collegiate bets, and threatening "any measures available under New Jersey law." The maximum fine is $100,000. Judge Edward S. Kiel enjoined the Division. On April 6, 2026 the Third Circuit affirmed on a likelihood of pre-emption: an injunction ruling, not a final merits judgment.

The NFL is not a party. Counsel of record Cody L. Reaves of Torridon Law PLLC signed the brief with William P. Barr and league counsel Theodore W. Ullyot. The examples are a 2026 Commanders playoff contract, a Week 18 game against the Cowboys, and a CeeDee Lamb touchdown total. DCMs call each a swap.

A sports-related event contract, in the National Football League's October 8, 2026 brief, is a wager that creates risk, not a swap that shifts a risk a firm already holds. The brief in Flaherty v. KalshiEX, LLC, No. 26-299, asks the Supreme Court to prefer the Sixth and Ninth Circuits. The hinge is 7 U.S.C. § 1a(47)(A)(ii), which can treat as a swap a payment that depends on an event "associated with a potential financial, economic, or commercial consequence." On April 6, 2026 the Third Circuit stopped at that sentence. The league says the hedging history of the Commodity Exchange Act does not. A field goal, a penalty, or a touchdown total does not hedge a crop, a currency, or a loan book. On the first Sunday of the 2026 season, the NFL told the Court, its contracts were $1.8 billion of $3.3 billion traded on prediction markets.

The brief grounds the reading in the Grain Futures Act of 1922 and in 7 U.S.C. § 5(a), and in the Ninth Circuit's line that the contracts "create risk, largely for ordinary consumers, where none previously existed." In 77 Fed. Reg. 48,208 (August 13, 2012), the CFTC and the Securities and Exchange Commission (SEC) refused to treat ordinary consumer deals as swaps. Dodd-Frank was signed on July 21, 2010, while a 1992 sports-betting statute still bound the states. The special rule, 7 U.S.C. § 7a-2(c)(5)(C), lets the Commission review gaming contracts. The June 12 proposal would define "gaming." Comments closed on July 27, 2026. Self-certification under 17 C.F.R. § 40.2 can still list the next business day.

How three courts and three rulebooks split one contract

KalshiEX LLC v. Schuler, 2026 WL 2884087 (6th Cir. September 25, 2026), concluded that "Kalshi's sports-event contracts do not satisfy the statutory definition of a swap." Assad and Blue Lake Rancheria go the same way. The brief says those courts "got it right, given the current landscape." See the earlier account of Kalshi v. Flaherty and the spring note on the circuit split.

The split on sports event contracts is a classification fight, not a quarrel about which courthouse is convenient. Under 7 U.S.C. § 1a(47)(A)(ii) a swap may include a payment tied to an event with a potential financial, economic, or commercial consequence. The Third Circuit, affirming a preliminary injunction on April 6, 2026 in KalshiEX, LLC v. Flaherty, No. 25-1922, treated a sports result as close enough for field pre-emption of state law on a CFTC-licensed designated contract market. The Sixth Circuit on September 25, 2026, and the Ninth Circuit on August 28, 2026, held that Kalshi's sports-event contracts are not swaps, because they create consumer risk instead of hedging a risk that already exists. The NFL brief of October 8, 2026 adopts that second reading. The Commission's June 12, 2026 proposal records the wider pool: registered prediction-market volume exceeded $25 billion in 2025, beside futures notional of around $31 trillion.

Britain does not ask the question. Section 33 of the Gambling Act 2005 makes unauthorised facilities for gambling an offence. A separate European product ban is described in the note on ESMA's binary-options ban and event contracts.

Sources: 91 Fed. Reg. 35,806; Third Circuit opinion; CFTC Release No. 8478-22; Gambling Act 2005, s. 33; NFL brief. Last updated: October 9, 2026.

"As it was for my predecessors, there is no greater priority for me as the Commissioner of the National Football League than protecting the integrity of our sport."

— Roger Goodell, Commissioner, National Football League (NFL.com, May 21, 2018)

The enforcement record the brief is arguing from

New Jersey has not collected the $100,000 the statute allows. The Division sent the letter. Kalshi took an injunction. The NFL's point is what a national version of that injunction would leave behind: game integrity in a derivatives agency that, the league says, has not copied the guards state books already use.

The federal money penalty here is not a sports case. On January 3, 2022, CFTC Release No. 8478-22 ordered Blockratize, Inc., doing business as Polymarket, to pay a $1.4 million civil monetary penalty for event-based binary options offered from about June 2020 with no DCM or swap-execution-facility registration, plus a wind-down and a cease-and-desist. More than 900 markets had been listed.

"All derivatives markets must operate within the bounds of the law regardless of the technology used, and particularly including those in the so-called decentralized finance or 'DeFi' space."

— Vincent McGonagle, Acting Director of Enforcement, Commodity Futures Trading Commission (CFTC Release No. 8478-22, January 3, 2022)

The brief cites the April 17, 2024 Associated Press account of the NBA ban of Jontay Porter, and a January 11, 2026 account of a $400,000 payout after Nicolás Maduro's capture. Its ban list has four parts: single-person contracts, including a missed field goal and the broadcast mentions in CFTC Letter 26-27; injuries and misconduct; officiating; and results knowable in advance. The Commission had not adopted it. Tennessee and Ohio use a minimum age of 21. DCM access remains 18.

Rule 17 C.F.R. § 180.1(a) bars manipulative devices. Staff Letter No. 26-08 (March 12, 2026), the brief says, tells DCMs to police insider trading, and without the league's names those policies are "paper tigers." The Perez order is the Commission's own inside-information case. The brief's headcount, from executive director Jeffrey Sutton's September 29, 2025 memorandum, is 543 staff, against close to 400 gaming employees in Nevada and in Pennsylvania.

What this means for exchanges, brokers and compliance teams

The line that changes a business is the circuit boundary. A DCM that self-certifies sports contracts under 17 C.F.R. § 40.2 is inside the Third Circuit's preliminary view and exposed to state gaming law in the Sixth and Ninth. The twin event-contract rules had already ended the no-action comfort. The October brief adds the NFL, asking the Court to hold that the swap definition does not cover the product.

If the Court denies review, or affirms the Third Circuit, the integrity fight stays at the CFTC and, the brief says, in Congress before the 2027 season. The May 15 and July 27 letters asked for a flat ban, age 21, and league bettor lists. The other result puts age, license, and the prohibited list into state law. Futures commission merchants and introducing brokers face the same split.

For a fund or a custodian, No. 26-299 sets no margin number. A swap sits in the commodity-interest framework. A bet may sit in a mandate ban or a state prohibition. The brief tells the Court the gambling description is the honest one. The live markers for a compliance file are November 9, 2026, the July 27 close of RIN 3038-AF65, and 17 C.F.R. § 180.1(a) read with Staff Letter No. 26-08.

The NFL told CNBC on October 8, and CNBC disclosed a commercial relationship with Kalshi that includes a minority investment: "In the end, we believe that given the current resource constraints of the CFTC, this is a job better left to the states." It also said: "Neither the CFTC nor the prediction market companies themselves— despite our persistent urging — have banned categories of bets susceptible to manipulation or set a 21 age limit."

"Contrary to the NFL's statements, the CFTC is actively policing sports-related markets, which are now listed on nearly every U.S. commodities exchange. The CFTC's ongoing rulemaking addresses many of the NFL's supposed concerns. And those rules sit atop the same comprehensive system of federal enforcement that protects trillions of dollars of transactions in U.S. markets."

— Elisabeth Diana, spokeswoman, Kalshi (Associated Press, via the Los Angeles Times, October 8, 2026)

What is due before the 2027 season

The Court has not granted No. 26-299. Kalshi's response is due November 9, 2026, after the Clerk's September 22 extension. Neal Kumar Katyal of Milbank LLP is counsel of record for Kalshi. Solicitor general Jeremy M. Feigenbaum is counsel for New Jersey. The brief asks for a grant "before another NFL season goes by." A loss, it says, would send the league to the Commission, the DCMs, and Congress before the 2027 season.

On October 7, 2026 Ohio, 38 other states, and the District of Columbia filed. The Associated Press described that brief as support for New Jersey. October 8 also brought the American Gaming Association, 145 Indian tribes, former CFTC chairman Gary Gensler, and former Senator Christopher J. Dodd. No final rule under the June title was on the Federal Register on October 9. Comments had closed on July 27, and the NFL brief still calls the category ban and the age-21 limit unadopted.

Murphy v. National Collegiate Athletic Association, 584 U.S. 453 (May 14, 2018), held that Congress could not commandeer a state sports-betting ban. The brief, citing a Congressional Research Service note of July 15, 2026, says 39 states and the District of Columbia have since legalised a form of sports betting. The NFL was a PASPA party in Murphy. It now says that choice should not be withdrawn through the word "swap."

TL;DR

On October 8, 2026 the NFL filed an amicus brief in Flaherty v. KalshiEX, LLC, No. 26-299, supporting New Jersey's petition. The league says sports event contracts on a designated contract market are gambling, not Dodd-Frank swaps, and that the Sixth and Ninth Circuits were right. The Third Circuit on April 6, 2026 affirmed a preliminary injunction treating the contracts as swaps inside CFTC exclusive jurisdiction. The Court has not granted review. Kalshi's response is due November 9, 2026. The CFTC proposal of June 12, 2026, comments closed July 27, says registered prediction-market volume exceeded $25 billion in 2025, against about $31 trillion of futures notional. Until the Court acts, the same contract is a swap in one circuit and a state-law bet in two others.

FAQ

What case is the NFL brief filed in?

The case is Mary Jo Flaherty and Jennifer Davenport v. KalshiEX, LLC, No. 26-299. Flaherty leads the New Jersey Division of Gaming Enforcement. Davenport is the attorney general. Kalshi is a CFTC-registered designated contract market. The September 2, 2026 petition asks whether Dodd-Frank pre-empted state rules for in-state sports bets on those markets. The NFL brief of October 8 supports New Jersey. The Third Circuit, No. 25-1922, affirmed an injunction on April 6, 2026, not a final merits judgment.

Has the Supreme Court agreed to decide the swap question?

No. The docket shows a petition, not a grant. New Jersey filed on September 2, 2026, after Justice Alito extended the time. On September 22 the Clerk extended Kalshi's response to November 9, 2026. Briefs from states, tribes, and the NFL make review more plausible. They do not require it. Saying the league told the Supreme Court describes the filing. It does not mean the justices have set argument.

Why does the NFL say a sports contract is not a swap?

The league says a swap hedges a risk the parties already have. A sports contract creates a new retail risk. The text is 7 U.S.C. § 1a(47)(A)(ii). The Third Circuit thought a game qualified. The NFL relies on the hedging history of the Commodity Exchange Act and on the 2012 CFTC-SEC rule, and it adopts the Ninth Circuit's view that these contracts create consumer risk where none existed.

Which contracts does the NFL want off prediction markets?

Four groups. Contracts one person can swing, such as a missed field goal, and non-game contracts such as a broadcast mention. Contracts on injuries, fan safety, and misconduct. Contracts on officiating, including penalty counts. And contracts knowable in advance, such as whether the first play is a run or a pass. The league also wants age 21, not the 18-year-old access it says DCMs allow, plus use of the league's own list of people who must not trade.

What penalties do New Jersey and the CFTC actually have on the books?

The April 6, 2026 opinion says a New Jersey violation is a fourth-degree crime, with fines up to $100,000 under N.J. Stat. Ann. §§ 5:12A-11(c) and 2C:43-2. No such fine was collected, because the courts enjoined the Division. Separately, CFTC Release No. 8478-22 of January 3, 2022 ordered Blockratize, Inc., doing business as Polymarket, to pay $1.4 million for event-based binary options offered without DCM or swap-execution-facility registration. That order is about an unregistered venue, not a sports listing on a licensed DCM.

What is the next date, and how does Britain treat the same bet?

Kalshi's opposition is due on November 9, 2026. Comments on the CFTC proposal at 91 Fed. Reg. 35,806 closed on July 27, 2026. Britain does not ask the swap question. Section 33 of the Gambling Act 2005, in force on September 1, 2007, makes unauthorised facilities for gambling an offence. On summary conviction in England and Wales the maximum is 51 weeks, a level-5 fine, or both. The gate is a Gambling Commission licence, not a DCM.

This article is informational analysis only and does not constitute legal, regulatory, tax, or investment advice. Regulatory frameworks change frequently and interpretation depends on facts and circumstances; primary documents and official regulator guidance always supersede summaries. Firms should consult qualified legal counsel and their relevant supervisory authority before taking any action based on the analysis above.