Valve is contesting a lawsuit from the New York Attorney General that accuses the company of facilitating illegal gambling through loot boxes in its games. The company argues its mystery boxes are akin to collectibles like baseball cards and that the cosmetic items inside are not essential to gameplay.
Valve states it will fight the lawsuit in court but would comply with any future state legislation on loot boxes. It strongly objects to the proposed remedies, such as making items non-transferable and implementing extensive user tracking, believing they would harm consumers and innovation.
The main topics covered are the legal dispute over loot boxes being labeled as gambling, Valve's defense comparing them to physical collectibles, and the company's objections to the specific regulatory changes demanded by the New York Attorney General.
Valve wants players to know that it plans on fighting New York Attorney General Letitia James’ lawsuit, which last month accused the company of promoting “illegal gambling” through its in-game loot boxes. In an email sent to Counter-Strike 2, Dota 2, and Team Fortress 2 players in New York, Valve says it’s “disappointed” in the lawsuit’s claims, arguing that mystery boxes are “widely used” across other games and also exist in the physical world with baseball cards, Pokémon, and Labubu.
Valve says it will fight New York’s loot box lawsuit
New York AG Letitia James called loot boxes ‘quintessential gambling, but Valve says it’s more like Pokémon cards and Labubu.
New York AG Letitia James called loot boxes ‘quintessential gambling, but Valve says it’s more like Pokémon cards and Labubu.
Since 2023, Valve says it has worked with the AGs to explain how its virtual items and mystery boxes work. It argues that players “don’t have to open mystery boxes to play Valve games” and that most don’t “because the items in the boxes are purely cosmetic.” Valve plans to fight James’ claims in court, but claims it would comply if the state’s legislature passes regulations related to loot boxes.
When the lawsuit was filed, James issued a press release saying “Valve has made billions of dollars luring its users, many of whom are teenagers or younger, to engage in gambling in the hopes of winning expensive virtual items that they can cash in on,” citing in-game mechanics that resemble a slot machine and can award items worth as much as $1 million.
The company, however, says it has “serious concerns” about the changes the lawsuit is pushing for Valve to make, such as making boxes and the digital items inside non-transferable. “We think the transferability of a digital game item is good for consumers—it gives a user the ability to sell or trade an old or unwanted item for something else, in the same way an owner can sell or trade a tangible item like a Pokemon or baseball card,” Valve writes. “Transferability is a right we believe should not be taken away, and we refuse to do that.”
Other proposals it objects to include collecting additional information to determine if a user in New York is using a virtual private network (VPN) to disguise their location and to perform age verification, despite existing payment methods offering built-in age checks. “The type of commitments the NYAG demanded from Valve went far beyond what existing New York law requires and even beyond New York itself,” Valve writes. “It may have been easier and cheaper for Valve to make a deal with the NYAG, but we believed the type of deal that would satisfy the NYAG would have been bad for users and other game developers, and impacted our ability to innovate in game design.”
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