Valve sued by State of New York & fined triple its profit on loot boxes

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New York Attorney General Letitia James is suing Valve, claiming that the company’s use of loot boxes violates state law. The lawsuit asks Valve to refund money to New York players who have purchased items within their games.

Loot boxes have faced legal challenges almost since their creation. People and organizations have sued over them for a variety of reasons, sometimes claiming the rewards are misleading, and in other places, even considering them unlawful.

Valve, the company behind the Steam platform, has faced lawsuits before regarding how it runs its games. Currently, they’re involved in a $900 million legal battle over claims of unfair pricing on Steam. These cases often center around features like loot boxes and the trading of in-game items, particularly within the popular game Counter-Strike and on the Steam marketplace.

The gaming company is facing another lawsuit. This time, New York State, led by Attorney General Letitia James, filed the suit on February 25, 2026.

Valve, the company behind popular video games, has profited significantly from allowing both children and adults to gamble on virtual items, even though this practice is illegal. These features are designed to be addictive and can be damaging. Therefore, I am taking legal action against Valve to halt these unlawful practices and safeguard the people of New York.

— NY AG James (@NewYorkStateAG) February 25, 2026

Valve sued & urged to pay funds back to impacted players

New York Attorney General Letitia James announced on X (formerly Twitter) that the state is taking legal action against Valve to put an end to gambling features in its games. The lawsuit also aims to get Valve to reimburse New York players who were affected and pay penalties for breaking state laws.

New York Attorney General Letitia James is suing Valve, the video game company, alleging that its practices allow both children and adults to illegally gamble for valuable in-game items. James argues these features are addictive and harmful, and the lawsuit aims to halt what she considers unlawful behavior and safeguard New Yorkers.

The lawsuit specifically challenges how Valve handles purchases within its games. It argues that Valve’s use of loot boxes is essentially gambling, which is illegal according to New York’s laws and constitution.

The New York Constitution prohibits all forms of gambling, including lotteries, ticket sales, and bookmaking, within the state.

While there are always exceptions, this isn’t one of them when it comes to Valve. The lawsuit claims that Valve’s loot boxes haven’t been legally approved and are therefore illegal.

New York Attorney General Letitia James is demanding that Valve stop what she considers illegal gambling within the state and also pay a penalty for past actions.

Valve is required to provide a detailed report of the money lost by New York consumers due to unlawful activity, and then fully compensate them for all resulting damages, both direct and indirect.

Valve will also have to pay a penalty equal to three times the profit it made from the practices it’s accused of.

It’s really hard to say exactly how much money Valve makes from New York gamers, because that kind of specific data isn’t available to the public. But honestly, depending on how many people in New York play their games, it could easily be tens of millions of dollars! It’s a huge potential market, and as a fan, it’s cool to think about how much impact New York gamers have.

TopMob has reached out to Valve for comment.

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2026-02-26 01:49