In an unusual show of candour, Valve have spoken out publicly against a lawsuit filed in New York, USA that accuses them of “letting children and adults alike illegally gamble” via loot boxes in Counter-Strike 2, Dota 2, and Team Fortress 2.
With the caveat that I am no Atticus Finch-esque legal expert or even a Louis Tully-grade bumbler, I find Valve’s rebuttal to be a mixture of whataboutery and tactical mitigation, with a couple of fair points. It basically sidesteps what I think is the lawsuit’s most important argument – that lootbox mechanics are fundamentally manipulative. You can read the thing in full here, or you can read my slapdash summary-with-notes, below.
The post starts by saying that Valve don’t believe the games in question violate New York’s gambling laws, while claiming that the company have been “working to educate” New York’s attorney general Letitia James and her colleagues “about our virtual items and mystery boxes since they first reached out to us in early 2023”.
Valve’s initial defence against the claim about illegal gambling is that loot box mechanics – aka, randomised rewards presented in the form of a sealed container – are “widely used” outside Steam, “not just in video games but in the tangible world as well, where generations have grown up opening baseball card packs and blind boxes and bags, and then trading and selling the items they receive”.
The post compares loot boxes in Valve games to packets of Pokemon and Magic the Gathering cards, and to “digital packs similar to our boxes” that “date back to 2004”. It doesn’t go into specifics, but Valve are possibly referring to MapleStory’s “gachapon tickets”, which were added to the Japanese version of the game in June 2004.
Valve further point out that Counter-Strike 2, Dota 2 and Team Fortress 2 players aren’t forced to buy lootboxes and mostly choose not to, because they only contain cosmetic items that don’t help you win. Which reads to me like ducking around the argument that lootbox mechanics are enticing and habit-forming in themselves, whatever the in-game function of the reward.
Then, Valve talk about their history of policing outright gambling on Steam: locking “over one million Steam accounts that were being misused by third parties in connection with gambling, fraud, and theft”; introducing features like trade reversal – which lets you roll back all Steam community market trades from the past seven days – and trade cooldown – which slaps a waiting period on trades of new purchases – to “discourage gambling sites’ ability to operate and protect Steam users from fraud”; forbidding gambling organisations from sponsoring or participating in tournaments for Valve games.
The post continues with some pushback against corrective measures proposed by New York’s attorney general. Firstly, they’re not keen on the idea that lootbox contents shouldn’t be tradeable on Steam’s marketplace. That you can sell Valve lootbox items for real money is a core plank of the New York lawsuit’s claim that lootboxes qualify as a form of gambling under state law, because the items concerned evidently have ‘real’ economic value.
Valve again make a comparison with trading cards, which you can obviously sell online – if that’s fine, they suggest, why isn’t it fine to sell your digital Counter-Strike knives? They argue that “the transferability of a digital game item is good for consumers”, calling this “a right we believe should not be taken away, and we refuse to do that.” The post doesn’t mention that Valve themselves take a cut from every Steam market trade, to the tune of many millions of dollars.
Valve also don’t like the NYAG’s proposal for more stringent verification to ensure that New York residents aren’t using, say, VPNs to circumvent Steam’s prohibitions, arguing that “this would have involved implementing invasive technologies for every user worldwide”. They’re not prepared to collect more data for the purposes of age verification, either, because “most payment methods used by New York Steam users already have age verification built-in”. (There is a whole other debate raging about age verification and privacy violations at the moment, which dates back to the beginnings of the payment processor crackdown last year.)
Valve end by stating that they’ll comply with any legislation passed on “mystery boxes”, commenting that “such laws would be the result of a public process, presumably with input from the industry and New York gamers”. But they feel that the NYAG’s proposals exceed the bounds of the law. “It may have been easier and cheaper for Valve to make a deal with the NYAG, but we believed the type of deal that would satisfy the NYAG would have been bad for users and other game developers, and impacted our ability to innovate in game design,” Valve write.
The platform holders chuck in a parting jab against the NYAG lawsuit’s commentary on links between games and real-world violence, pointing to the lack of evidence of a causal connection, and describing the claims as “a distraction and a mischaracterization”. I definitely sympathise with Valve here: the ‘virtual violence directly incites violence’ rhetoric is a load of baloney, and its presence in the New York lawsuit gives the impression that the lootbox arguments are just a Trojan horse for a campaign against videogames at large. At the very least, it’s an open goal for Valve.
Since the New York lawsuit, another legal case has been brought in Washington, USA, making comparable claims. If you want more insight on the “manipulative mechanics” stuff, we wrote about that one at greater length. Alternatively, you can read Connor Makar’s Eurogamer interview with an actual lawyer about the specifics of the New York case.
