Valve is no stranger to lawsuits. From small-scale litigation to full-blown class-action cases, Valve has been somewhat of a court magnet, with both individuals and governments coming after the company on various grounds. One of the more recent cases is the one brought by New York’s attorney general, who is pursuing action against the company’s loot boxes, which it describes as “gambling.”
But what is truly rare is Valve speaking out about it. In the majority of lawsuits that came across its desks, Valve never really went out in public to speak about them, no matter what the basis for them was. Now, however, the company found it apt to defend its position, especially its use of microtransactions (loot boxes) in games like Dota 2 and Counter-Strike 2.
The New York attorney general (NYAG) first contacted Valve in 2023, seemingly to try to strike a deal with the company that’d make it comply with NY law. However, Valve says that the NYAG requested the company to make significant changes to its business operation, which, while nominally tied to loot boxes, would have impacted everyone who used Steam in the world, including both gamers and developers.
Primarily, Valve argued that its loot boxes are akin to real-world card packs, which people can purchase just about everywhere and then open to gain random cards. These cards, like the skins in Valve’s games, can be freely sold or traded for other items.
“On the physical side, popular products used in this way include baseball cards, Pokémon, Magic the Gathering, and Labubu. In the game space, digital packs similar to our boxes date back to 2004 and are in widespread use,” Valve stated.
“Players don’t have to open mystery boxes to play Valve games. In fact, most of you don’t open any boxes at all and just play the games.”
Valve also said that it had shown to the NYAG that it did everything in its power to stop gambling, either through shutting down sites, banning users who engage in it, or implementing trading mechanisms. Gambling companies are also barred from sponsoring tournaments where Valve games are played.
“To date we’ve locked over one million Steam accounts that were being misused by third parties in connection with gambling, fraud, and theft,” Valve explained.
However, despite all of their efforts to curb gambling and explain how microtransactions work in its games, Valve was allegedly met with requests from the NYAG that it refused to comply with. “We have serious concerns with many of the alterations the NYAG claims are necessary to make to our games,” Valve said.
Firstly, the NYAG supposedly asked Valve to remove the ability for users to trade and sell the things they get in loot boxes. However, Valve thinks “transferability is a right we believe should not be taken away” and “refuse[s] to do that.”
Furthermore, Valve was seemingly asked to collect extra information on users so as to pinpoint the exact locations of potential New York residents who have been hiding their location via apps like VPNs, which the company said required “invasive technologies” to be implemented worldwide, affecting everyone’s privacy and security.
More data collection was also requested for the purpose of additional age verification, even though payment methods necessary to engage in purchases on Steam are already a form of age verification themselves.
These requests go “far beyond what existing New York law requires and even beyond New York itself.”
Valve concludes by saying it could have struck a deal with the NYAG, but that it “would have been bad for users and other game developers and impacted our ability to innovate in game design.”
The NYAG’s comments about video games and violence were addressed by Valve, which said that “Those extraneous comments are a distraction and a mischaracterization we’ve all heard before. Numerous studies throughout the years have concluded there is no link between media (movies, TV, books, comics, music, and games) and real-world violence.”
Many of Valve’s games contain loot box mechanics, which have been regularly construed as gambling by gamers for years. They aren’t exclusive to Valve, of course, as similar mechanics can be found in most modern live-service games, such as League of Legends, EA FC 26 (and most of its predecessors), and many others.
EA had previously been pursued by Belgium, a country unique among governments of the world with proper loot box laws, so the fact that Valve is now the target of similar litigation isn’t exactly surprising.
It’s a company that makes billions from its boxes, but even so, this could set a precedent that’d see the downfall of trading card games like the ones named above, as, in principle, both function in the same way.
