LAS VEGAS (KLAS) — Robinhood is suing the Nevada Gaming Fee, escalating the battle over Nevada’s authority to ban sports activities futures contracts.
A lawsuit filed Tuesday in U.S. District Court docket in Nevada seeks an injunction towards state gaming regulators, stopping them from implementing Nevada legal guidelines.
“Sports-related event contracts” are transactions topic to Nevada gaming legal guidelines within the view of state authorities. The alternative view is that it is only a commerce, topic solely to guidelines on futures buying and selling.
Robinhood and one other firm — Kalshi LLC — are utilizing the courts to argue that Nevada has no say over the transactions. Kalshi gained an injunction in New Jersey and the court docket held that Kalshi demonstrated a probability of success regarding its argument that Nevada regulation is preempted, in keeping with the lawsuit.
Robinhood, a $94 billion firm that offers in commission-free on-line buying and selling of shares and different monetary merchandise, stated the court docket ruling in Kalshi’s favor is a transparent sign that Nevada cannot win the argument. An injunction is in place, however Nevada continues to implement its legal guidelines, the lawsuit stated.
A spokesman for Robinhood offered this assertion: “Our event contracts, including those for pro and college football, are offered in a compliant, federally regulated way through our CFTC registered Futures Commission Merchant, Robinhood Derivatives. This is a decisive step forward in our mission to democratize finance for all and unlock even more innovative market opportunities for investors.”
The lawsuit names every of the gaming commissioners individually and the fee as an entire. It additionally names Nevada Lawyer Common Aaron Ford as a defendant.
After the April rulings in Kalshi’s favor, Robinhood met with the Gaming Management Board — the enforcement arm for Nevada gaming legal guidelines — however that did not change Nevada authorities’ place. “They stated that they would contact Robinhood if they ultimately reached a different conclusion, and to date, they have not done so,” the lawsuit stated.
On Could 8, the Gaming Management Board definitively acknowledged that sports-related occasion contracts could be thought-about a violation of Nevada regulation in a letter to Robinhood.
