Valve has released a formal response to the recent lawsuit from New York alleging that Valve’s use of lootboxes could run afoul of gambling laws.

Last month, New York Attorney General Letitia James announced that the state is pursuing a lawsuit against Valve. For years, lootboxes have been a part of “games as a service” and introduce a chance-based element which admittedly does lend itself to gambling and speculation.

However in Valve’s recent statement addressing the lawsuit, draws obvious parallels which ought to be addressed. In the opening paragraphs, Valve equates lootboxes to other chance products which have enjoyed far less scrutiny.

We shared with the NYAG that these types of boxes in our games are widely used, not just in video games but in the tangible world as well, where generations have grown up opening baseball card packs and blind boxes and bags, and then trading and selling the items they receive. On the physical side, popular products used in this way include baseball cards, Pokemon, Magic the Gathering, and Labubu. In the game space, digital packs similar to our boxes date back to 2004 and are in widespread use. Players don’t have to open mystery boxes to play Valve games.

Emphasis: Ours

Valve goes on to question the state’s desires for how Valve ought to respond, pointing out that making loot box assets transferable is pro-consumer. They again compare digital products to physical ones, pointing out that baseball and Pokemon cards are regularly traded and sold with little controversy.

Perhaps what’s most worrying is that according to Valve, the state is demanding additional information about consumers. Valve says the information requested could be used to locate New York users who use a VPN and otherwise compromise the personal information of users.

The NYAG also proposed to gather additional information (beyond what we normally collect in the course of processing payments) about each game user on the off-chance someone in New York was anonymizing their location to appear outside of New York, such as by using a VPN. This would have involved implementing invasive technologies for every user worldwide.

The topic of age-verification and requiring an ID to use online services has been coming up more and more in recent months. While this is usually done under the auspices of “protecting the children“, the desired end result is nothing less than a requirement to report your online activities to the government.