Valve Sued For "Promoting Illegal Gambling" By New York Attorney General

Valve’s loot boxes are coming under fire in a new lawsuit from New York Attorney General Letitia James. The AG’s office is alleging that loot boxes in Valve’s games–including Counter-Strike 2, Team Fortress 2, and Dota 2–violate New York’s gambling laws and potentially harm children.

In Valve’s games, players can use real money to buy loot boxes, which allow them to potentially win a virtual item that may have real monetary value because they can be resold on the Steam Community Market. The lawsuit contends that Valve has made billions by encouraging players of all ages–including teenagers and younger gamers–to keep purchasing loot boxes in the name of winning rare and valuable items. According to James’s office, the goal of the lawsuit is to permanently prevent Valve from promoting its “illegal gambling” in games and to fine the company for violating state laws.

“Illegal gambling can be harmful and lead to serious addiction problems, especially for our young people,” said James in a statement. “Valve has made billions of dollars by letting children and adults alike illegally gamble for the chance to win valuable virtual prizes. These features are addictive, harmful, and illegal, and my office is suing to stop Valve’s illegal conduct and protect New Yorkers.”

The lawsuit goes on to note that the virtual items won in loot boxes aren’t just resold in the Steam Community Market. Players also have the option to sell them through third-party vendors in exchange for real money. Counter-Strike 2 skin trading is a big market that’s worth billions. In 2023, a Counter-Strike skin sold for $160,000. Just over a decade ago, Valve moved to shut down Counter-Strike gambling sites, but that hasn’t prevented gaming industry figures from taking the company to task for its in-game gambling mechanics. James’s office adds that its “investigation found that Valve facilitates and even assists these third-party marketplaces in their operations.”

Although this lawsuit is about loot boxes and “illegal gambling,” the office of the Attorney General also attempts to link Valve’s “promotion of games that glorify violence and guns helps fuel the dangerous epidemic of gun violence, particularly among young gamers who can become numbed to grave violence before their brains are fully developed.” That appears to be more of a spurious correlation for PR purposes than something the AG intends to argue in court.

GameSpot has reached out to Valve for comment.

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