Valve Plans to Challenge New York’s Lawsuit Over Loot Boxes

Valve is gearing up to challenge the lawsuit filed by New York Attorney General Letitia James, which accuses the company of facilitating “illegal gambling” through its in-game loot boxes. In a message directed at players of Counter-Strike 2, Dota 2, and Team Fortress 2 in New York, Valve expressed its disappointment with the lawsuit’s allegations, emphasizing that mystery boxes are a common feature in many games and have parallels in the real world, such as baseball cards and Pokémon.

Since the start of 2023, Valve has been in discussions with the Attorney General’s office to clarify how its virtual items and mystery boxes function. The company asserts that players are not required to open these boxes to enjoy its games, noting that most players opt not to because the items contained are purely cosmetic. Valve intends to contest James’ claims in court but has stated it would adhere to any new regulations regarding loot boxes if enacted by the state legislature.

In her press release upon filing the lawsuit, James claimed that “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,” pointing to in-game mechanics that mimic slot machines and can yield items valued at up to $1 million.

Valve, however, has expressed “serious concerns” about the changes the lawsuit demands, such as making loot boxes and their digital contents non-transferable. The company argues that allowing the transfer of digital game items benefits consumers by enabling them to sell or trade unwanted items, similar to how one might deal with physical collectibles like Pokémon cards or baseball cards. “Transferability is a right we believe should not be taken away, and we refuse to do that,” Valve stated.

Additionally, Valve opposes other proposed measures, including the collection of extra information to check if a user in New York is using a virtual private network (VPN) to mask their location and implementing age verification, despite existing payment methods already providing 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 noted. “While it might have been easier and cheaper for Valve to settle with the NYAG, we believe that such a deal would have been detrimental to users and other game developers, hindering our ability to innovate in game design.”