Valve sued over Counter-Strike and Dota 2 loot boxes in New York

New York State Attorney General Letitia James has filed a lawsuit against Counter-Strike developer Valve, alleging that the company illegally promotes gambling through loot box mechanics in its games.

The details:

• The lawsuit, filed on Wednesday in Manhattan state court, accuses Valve of allowing people of all ages, including children, to illegally gamble through Counter-Strike 2, Dota 2, and Team Fortress 2’s loot box systems, violating New York's Constitution and Penal Law.
• It’s claimed that the developer has made “billions of dollars” by charging players for keys to unlock virtual loot boxes containing a random selection of in-game cosmetic items. The lawsuit describes the systems as "quintessential gambling," highlighting that opening crates in Counter-Strike 2 “resembles a slot machine, with an animated spinning wheel that eventually rests on a selected item.”
• While items acquired from the loot boxes are purely cosmetic, they can be sold on the Steam Community Market or unofficial third-party platforms in exchange for real-world money. The lawsuit notes that although some rare items have sold for thousands of dollars, including a single AK-47 skin that sold for around $1 million USD, players frequently receive items worth less than the cost of the key used to unlock the loot box.
• James is now seeking to permanently prohibit Valve from promoting any gambling-like features in its games, demanding the company disgorge all profits it has allegedly earned through the loot boxes, and requesting fines worth up to three times Valve's revenue, equating to billions of dollars. The lawsuit also seeks restitution for New York users who paid for keys to open loot boxes. “Illegal gambling can be harmful and lead to serious addiction problems, especially for our young people,” James said 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.”