New York files a lawsuit against Valve, claiming its loot boxes are ‘the essence of gambling’

New York Attorney General Letitia James is taking legal action against Valve for “illegally endorsing gambling” through loot box mechanisms employed in video games like Counter-Strike 2, Team Fortress 2, and Dota 2, as stated in a press release. The attorney general aims to “permanently prohibit Valve from promoting gambling features in its games, reclaim all profits obtained unlawfully, and incur penalties for breaching New York’s laws.”

“The loot box system established by Valve — charging an individual for a chance to win something of worth entirely based on chance — epitomizes gambling, which is banned under New York’s Constitution and Penal Law,” the lawsuit states. Valve has reportedly earned “tens of millions of dollars” selling loot box keys to “thousands” of New York inhabitants and has “earned millions more in commissions from New Yorkers who traded virtual items secured from loot boxes.” The complaint also describes the company’s loot boxes as “particularly harmful” because they are favored by children and young people.

Participants can buy keys to unlock loot boxes in several Valve games and obtain randomly chosen virtual items as rewards. If they choose, they can then sell those rewards on the Steam Community Market and various third-party platforms; the rarer items might be valued at “thousands of dollars,” as per the lawsuit. However, users are required to pay Valve $2.49 plus taxes to unlock the loot boxes, and often receive items “worth less than what the user paid for the key.” The lawsuit also highlights that the process for opening a loot box in Counter-Strike 2 is akin to a slot machine experience.

Valve did not promptly respond to a request for a statement.