New York Attorney General Letitia James Sues Valve Over Alleged Loot Box Gambling

New York Attorney General Letitia James has announced that she, on behalf of The People of the State of New York, is suing game developer Valve. 

James is suing them for "illegally promoting gambling through video games popular with children and teenagers." 

The games named in the suit specifically were Counter-Strike 2, Team Fortress 2, and Dota 2. 

The suit was filed on Feb. 25, 2026, following an investigation by the Office of the Attorney General. The suit alleges that those Valve games encourage gambling via paid loot box mechanics. 

More on the Suit 

With this lawsuit, James intends to “permanently stop Valve from promoting gambling features in its games, disgorge all ill-gotten gains, and pay fines for violating New York’s laws.”

Additionally, the suit alleges that Valve has a process that enables players to obtain loot box items and sell them on third-party platforms for cash. 

"Users can also connect their Valve accounts to third-party marketplaces where the virtual items can be sold directly for cash. The OAG’s investigation found that Valve facilitates and even assists these third-party marketplaces in their operations."

When it's all said and done, James is seeking to "permanently stop Valve from promoting gambling features in its games, disgorge all ill-gotten gains, and pay fines for violating New York’s laws."

James has taken action against other forms of gaming/gambling in the past, sending cease-and-desist letters to sweepstakes casinos before they were eventually banned before the end of 2025. 

James Social Media Statement

James took to X to discuss the suit and Valve more, saying the following: 

"Valve, a video game developer, has made billions of dollars by letting children and adults illegally gamble for the chance to win valuable virtual prizes. 

"These features are addictive and harmful.

"That's why I'm suing to stop Valve’s unlawful conduct and protect New Yorkers."

However, a Community Note was posted in response to her post, which read as follows: 

"CS is rated M with Steam parental controls. Minors playing reflects parental supervision choices only.

"Cosmetics are optional with disclosed odds and no cash-out on Steam. Firms shouldn’t be penalized for creating products so popular that users themselves deem valuable"

Valve, a video game developer, has made billions of dollars by letting children and adults illegally gamble for the chance to win valuable virtual prizes.

These features are addictive and harmful.

That's why I'm suing to stop Valve’s unlawful conduct and protect New Yorkers.

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

There are also links supporting each statement in the Community Note.

Valve's Stance on Loot Boxes

In September 2025, Counter-Strike 2, one of the games named in the suit, introduced the Genesis Uplink Terminal on the Show Off update. There, a new method for getting skins appeared to be revealed, where players could choose from 1 of 5 skins, rather than purchasing a case and a key to open it. 

The Terminals would get by loot boxes, a mechanic that has been banned in the Netherlands, Belgium, and France. 

Additionally, Valve has taken action against third-party sites involved in skin gambling. 

Right now, Valve hasn't issued a statement.