By Olivia Davis | Mar 12, 2026
The lawsuit asked the court to stop Valve from allowing loot boxes in the state of New York and could result in financial penalties or restitution.
Valve Denies Allegations
On March 11, Valve published an article on Steam, which is their online gaming platform denying the allegations.
Valve says that the mystery boxes are similar to traditional real-life collectibles that are based on chance. Examples of these items are Pokémon trading cards, Magic: The Gathering trading cards, and surprise collectible toys like Labubu.
Valve also stated that players are able to fully play their games without ever purchasing a loot box, and the loot box does not give any advantage in gameplay.
Dispute over Actual Value of Items
New York's state government argues that items won from loot box purchases have real-world value due to the fact that they can be sold for large sums of money on the Steam Community marketplace or third-party trading sites.
Because players spend real-life money for the possibility of receiving an item from the loot box, the state believes this satisfies the legal definition of gambling.
Valve disagrees with the state of New York and believes that virtual goods purchased from loot boxes should be treated the same as real-life goods. Meaning people can freely buy, sell or trade items.
Wider Debate Within Gaming Industry
This lawsuit represents a larger debate inside the gaming industry about the regulation of loot boxes in video games. Game developers often compare loot boxes to other traditional collectibles, while critics of this form may not have the same opinion because the availability of access to children from digital platforms creates a much greater risk.
To date, Belgium and the Netherlands in Europe have taken a position and imposed restrictions and/or bans to certain types of loot box systems.
The outcome of this New York state lawsuit will affect how similar systems operate and will set a precedent that will apply to other companies such as Epic Games and Activision Blizzard, who utilize reward mechanics in their games.
Ultimately it will be a court's decision as to whether or not loot boxes are just a digital form of collecting or that loot boxes should be considered a form of gambling, which is eligible for regulation.
