Published on: February 26, 2026, 08:06h.
Updated on: February 26, 2026, 08:06h.
- New York Attorney General Takes Legal Action Against Valve Regarding Loot Boxes
- Letitia James Claims Loot Boxes Are a Form of Gambling
- Players Use Real Money to Purchase Keys for In-Game Treasure Chests
New York’s Attorney General, Letitia James, has initiated a lawsuit against Valve, asserting that the sale of in-game “loot boxes” equates to illegal gambling.
Valve Corporation, based in Bellevue, Washington, is known for popular games like Counter-Strike, Dota, Half-Life, and Team Fortress. The lawsuit claims they enable illegal gambling through loot boxes, where users can spend real money to unlock virtual treasure chests in hopes of receiving cosmetic enhancements, improved weaponry, special abilities, and in-game currency.
James argues that loot boxes give minors exposure to the thrill felt while gambling, similar to spinning a slot machine. Despite a ruling by the FTC last year requiring parental consent for minors under 16 to purchase loot boxes, many teens are still vulnerable, according to James.
“Illegal gambling poses serious risks and can lead to addiction, particularly among our youth. Valve has profited immensely by allowing both children and adults to partake in unlawful gambling for a chance to win valuable in-game items,” stated Attorney General James.
“These mechanics are harmful, addictive, and illegal. My office is taking action to halt Valve’s unlawful practices and safeguard New Yorkers,” James added.
Historically, video game publishers have successfully defended against similar lawsuits regarding loot boxes. Courts in California have ruled that they do not qualify as illegal gambling.
New York AG Draws Parallels to Slot Machine Mechanics
Valve, which has not yet commented on the lawsuit, is accused of endorsing gambling practices within games that attract a younger audience.
In Counter-Strike, Valve’s flagship title, James illustrated that the act of opening a loot box mirrors the excitement of a slot machine, featuring an animated reel that lands on a chosen item.
It is estimated that video game companies generated $22.7 billion globally from loot box sales in 2025, with projections expecting this market to exceed $36 billion by 2032.
“Young users, often with limited financial means, are lured into gambling through loot boxes in hopes of gaining a virtual item that may elevate their prestige in the game. Research indicates that those introduced to gambling as children are four times more likely to encounter gambling issues later in life,” the press release from James stated.
Loot boxes function as supplementary attractions rather than integral components of gameplay. Valve charges users for keys that unlock these loot boxes, bestowing virtual items that can be traded on Valve’s marketplace, the Steam Community Market.
Details of the Lawsuit
James is seeking restitution for consumers, alongside a penalty amounting to three times Valve’s claimed illicit earnings. Moreover, the AG requests the court to prohibit Valve from promoting gambling features and loot boxes in its offerings.
This legal action has been filed in the Supreme Court of New York County.