New York sues Valve for promoting illegal gambling via game loot boxes
Source: Bleeping Computer
Lawsuit Overview
New York Attorney General Letitia James sued video‑game developer and publisher Valve Corporation for using game loot boxes to facilitate illegal gambling activities among children and teenagers.
Valve operates Steam, one of the largest digital game‑distribution services in the world, offering access to thousands of games for millions of users worldwide. At the time of publication, Steam was reporting over 29 million players online, with nearly 7.5 million playing a game (source).
Attorney General James said the gaming giant is violating New York’s gambling laws by offering players the opportunity to win random virtual prizes that can be exchanged for real money, a process described as being similar to a slot machine.
“Illegal gambling can be harmful and lead to serious addiction problems, especially for our young people,” James said. “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.” (source)
Games and Loot Boxes Targeted
The lawsuit focuses on loot boxes in:
- Counter‑Strike 2
- Team Fortress 2
- Dota 2
These loot boxes award players with random items such as weapon skins or character accessories. The Attorney General alleges that Valve deliberately skews the odds of winning rare items, inflating the total market value of such items to an estimated $4.3 billion as of March 2025.
Financial Impact
- Some individual items (e.g., AK‑47 skins) have fetched prices of over $1 million (source).
- Steam accounts are a frequent target for hackers and scammers (source).
Potential Harm to Children
The lawsuit highlights that loot‑box purchases can draw children into gambling‑like behavior, boosting social status within gaming communities. Research cited in the press release notes that children introduced to gambling are four times more likely to develop a gambling problem later in life.
Legal Demands
Attorney General James has asked the court to:
- Permanently bar Valve from operating loot‑box features in New York.
- Require Valve to return all profits generated by the practice.
- Impose fines for the alleged violations.
Related Litigation
In January 2025, Cognosphere (aka Hoyoverse), the developer of Genshin Impact, agreed to pay $20 million to settle a U.S. Federal Trade Commission lawsuit over unfair marketing of loot boxes to minors and misleading odds (source).
Comment from Valve
BleepingComputer reached out to a Valve spokesperson for comment; a response was not immediately available.