A second lawsuit in a matter of weeks has been filed against Valve. The complaint alleges that the gaming company knowingly operates unlawful gambling through its loot box system. 

In a press release, legal firm Hagens Berman announced that it was bringing the lawsuit on behalf of consumers nationwide. 

“We believe Valve deliberately engineered its gambling platform and profited enormously from it,” said Steve Berman, Hagens Berman’s founder and managing partner. “Consumers played these games for entertainment, unaware that Valve had allegedly already stacked the odds against them. We intend to hold Valve accountable and put money back in the pockets of consumers.”

The company is encouraging others to join the action, asking gamers or parents to get in touch if they have purchased a loot box key or opened a loot box in Counter-Strike, Dota 2, or Team Fortress 2. 

The lawsuit follows New York’s Attorney General Letitia James taking similar action last month. James said she “seeks 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.”

Valve Encouraging Underage Gambling, Says Complaint

Berman added, “What makes this case particularly egregious is that Valve knew children were on the other end of these transactions. Rather than protect young players through age verification or a parental consent mechanism, we believe they rigged the game to extract more money from them.”

The lawsuit alleges Valve knowingly designed its loot box system using the same psychological triggers as casino game manufacturers. In addition, the company maximizes revenue by collecting a 15% commission on sales of virtual prizes through its Steam Community Market.

Valve has prohibited event organizers and esports teams from promoting third-party skins gambling and case opening sites. However, the lawsuit claims its own games are similar to those of unregulated gambling platforms. 

It says that unlocking a loot box in Counter-Strike resembles a virtual slot machine, with a simulated spinning wheel showing images of potential prizes. 

Additionally, players open loot boxes for the same reason they play slot machines – the chance to win a valuable prize, says the complaint. 

Lawsuit Seeks Restitution

The lawsuit has been filed in Seattle, at the US District Court for the Western District of Washington. It claims that Washington’s state laws broadly prohibit gambling devices and seeks restitution based on the Recovery of Money Lost at Gambling Act (RMLGA). 

Under the RMLGA, anyone can try to recover money that someone lost due to illegal gambling, acting on behalf of the person who lost it.

Hagens Berman claims to be one of the most successful consumer litigation law firms in the U.S. It notes that it has achieved settlements valued at more than $345 billion for class members in lawsuits against Big Tech companies, device manufacturers, and others.

Washington Has Precedent For Awarding Damages

In Washington, class actions have been successful against sweepstakes casinos. In 2020, Big Fish Casino agreed to pay a $155 million settlement after a federal judge ruled its games constituted illegal gambling under Washington state law. A U.S. District Court judge in Seattle had initially thrown out the complaint before the ruling.

In 2022, a class action against Zynga over its online gambling‑style games settled for about $12 million. Players in the state who participated in Zynga’s slot games received compensation as part of this settlement.

The trend continued last year, with a judge ordering High 5 Games to pay almost $25 million in damages to state players.

Last month, Washington’s Attorney General Nick Brown filed a new lawsuit against several companies that operate unlicensed gambling. Brown said the platforms have taken more than $225 million from Washingtonians since September 2020.

Like the complaint against Valve, Brown said, “It is especially troubling to see gambling apps targeting children.”