{"id":266029,"date":"2023-03-24T08:15:06","date_gmt":"2023-03-24T13:15:06","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=266029"},"modified":"2023-05-25T06:09:33","modified_gmt":"2023-05-25T11:09:33","slug":"cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/","title":{"rendered":"CFTC Says PredictIt Founder Will Get Fair Chance to Refute Allegations Against Exchange"},"content":{"rendered":"

In defending its motion to end an injunction granted to PredictIt, the US Commodity Futures Trading Commission (CFTC) told a federal appeals court on Thursday it’s giving the founder of the online political futures exchange due process as the federal agency considers revoking the no-action letter that led to PredictIt\u2019s creation.<\/p>\n

\"PredictIt\"<\/a>
A screen capture of PredictIt’s home page on March 24. On Thursday, the CFTC said it’s giving the political futures exchange’s creator due process after it issued a new letter earlier this month detailing the commission’s allegations that PredictIt has violated the terms of a no-action letter allowing it to operate since 2014. (Image: PredictIt)<\/figcaption><\/figure>\n

The CFTC\u2019s March 2 letter to Victoria University<\/a> of Wellington stands as \u201ca preliminary determination,\u201d the commission stated in its 29-page filing. That letter also retracted an Aug. 4, 2022, letter to the university that revoked the no-action declaration and, instead, listed three allegations uncovered by the Division of Market Oversight (DMO). DMO is allowing the university to respond to its findings with a deadline that has been pushed to April 5<\/a>.<\/p>\n

\u201cDepending on the University\u2019s response, staff may determine not to withdraw the no-action letter, or continue their no-action position as to unexpired contracts, as Plaintiffs wish,\u201d the CFTC\u2019s filing stated. \u201cIf not, staff will explain why.\u201d<\/p>\n

\n

Victoria University isn’t a plaintiff in the federal case that PredictIt filed with Aristotle International and several traders and researchers who use the exchange. The case originated in US District Court in Texas, with plaintiffs then taking their request for an injunction to the Fifth Circuit to prevent the exchange from being shut down due to language in the CFTC\u2019s August letter calling for existing markets to be liquidated by February 15.<\/p>\n<\/div>\n

The court granted that injunction<\/a> nearly two months ago.<\/p>\n

CFTC: PredictIt ‘Morphed’ Into Larger Exchange<\/h2>\n

The CFTC’s filing Thursday was its rebuttal to the plaintiffs’ response to the commission’s March 3 motion calling for the federal appeals court to lift the injunction.<\/p>\n

\n

By pulling the August letter, which had the February liquidation date, the CFTC argues that there\u2019s no longer a need for an injunction and that the plaintiffs\u2019 appeal is rendered moot. As such, it calls for the case to go back to the federal district court where the commission has called for it to be moved from Texas to the District of Columbia US District Court.<\/p>\n<\/div>\n

In the March 2 letter, the DMO claimed PredictIt has been violating the terms of the no-action letter essentially since the exchange began in 2014. That includes offering markets outside of the scope determined in the letter. DMO also alleged that Aristotle, a DC-based political consulting and technology firm, was actually the outfit running PredictIt and had paid a Victoria University subsidiary for the right to do so.<\/p>\n

Aristotle managing the exchange would run counter to the CFTC\u2019s decision to allow a \u201csmall-scale, not-for-profit\u201d exchange run by the New Zealand school for research purposes.<\/p>\n

The evidence now suggests PredictIt may never have been that,\u201d the commission stated. \u201cAt a minimum, however, PredictIt appears to have morphed into something quite different than what the university had originally represented.\u201d<\/p><\/blockquote>\n

According to the CFTC, the university proposed that three professors and an administrator would be the individuals running the exchange, and that it would contract with a vendor to ensure the identities of people registering on the exchange and that they were old enough to participate.<\/p>\n

It\u2019s possible that the court won\u2019t act on the CFTC\u2019s request until the commission itself renders a decision after considering Victoria University\u2019s objections, and the commission said it won’t object to additional briefings on the matter should the three-judge panel still have questions.<\/p>\n

CFTC Argues Against Sanctions<\/h2>\n

The CFTC also responded to plaintiffs\u2019 claims that its staff violated the terms of the injunction by issuing a new letter.<\/p>\n

Rather than cite the injunction, the CFTC says PredictIt and the other plaintiffs cited their own motion for the injunction.<\/p>\n

\u201cA motion is not an order,\u201d the commission stated. \u201cAnd this Court\u2019s January 26, 2023, order did not incorporate or reference any text in Plaintiffs\u2019 briefs, or give any other indication whatsoever that Plaintiffs\u2019 intro language was now the law.\u201d<\/p>\n

\n

In addition, the CFTC said its new letter didn’t call on PredictIt to stop its markets. All the new letter did was remove the February 15 \u201cliquidation mandate,\u201d which was the crux of the plaintiffs\u2019 case.<\/p>\n<\/div>\n

Lastly, any request for sanctions should be denied, according to the commission, because it has sovereign immunity.<\/p>\n

\u201cThe CFTC\u2019s conduct throughout this litigation has been consistent, taken in good faith, and at a minimum, substantially justified,\u201d it claimed, adding the litigation was \u201conly necessary because Plaintiffs filed suit without ever citing any case in which any court has held a no-action letter or its revocation judicially reviewable.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

In defending its motion to end an injunction granted to PredictIt, the US Commodity Futures Trading Commission (CFTC) told a federal appeals court on Thursday it’s giving the founder of the online political futures exchange due process as the federal agency considers revoking the no-action letter that led to PredictIt\u2019s creation. The CFTC\u2019s March 2 […]<\/p>\n","protected":false},"author":45,"featured_media":266030,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[60,61],"tags":[82218,82192,82190],"acf":[],"yoast_head":"\nCFTC: PredictIt Founder Will Get Fair Opportunity to Refute Claims<\/title>\n<meta name=\"description\" content=\"The CFTC said it may choose not to seek PredictIt's closure, depending on how Victoria University responds to its March 2 letter.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CFTC: PredictIt Founder Will Get Fair Opportunity to Refute Claims\" \/>\n<meta property=\"og:description\" content=\"The CFTC said it may choose not to seek PredictIt's closure, depending on how Victoria University responds to its March 2 letter.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2023-03-24T13:15:06+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-05-25T11:09:33+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/PredictIt-screen_1200.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"843\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Steve Bittenbender\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Steve Bittenbender\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/\",\"url\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/\",\"name\":\"CFTC: PredictIt Founder Will Get Fair Opportunity to Refute Claims\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/PredictIt-screen_1200.jpg\",\"datePublished\":\"2023-03-24T13:15:06+00:00\",\"dateModified\":\"2023-05-25T11:09:33+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/eb30e765d812fc9b38b333f8d13068b2\"},\"description\":\"The CFTC said it may choose not to seek PredictIt's closure, depending on how Victoria University responds to its March 2 letter.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/cftc-says-predictit-founder-will-get-fair-opportunity-to-refute-allegations-against-exchange\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/PredictIt-screen_1200.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/PredictIt-screen_1200.jpg\",\"width\":1200,\"height\":843,\"caption\":\"A screen capture of PredictIt's home page on March 24. 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