Valve Corp. Repels Final CS:GO Skins Gambling Lawsuit

Posted on: January 17, 2022, 02:31h. 

Last updated on: January 17, 2022, 03:55h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

A federal judge in Washington State has dumped a longstanding lawsuit against Valve Corp, which claimed the video games publisher enabled kids to gamble using “skins.”

skins gambling
A “skin,” or designer weapon in CS:GO, above. Their proliferation beyond the Steam platform six years ago spawned a clandestine gambling industry and a slew of lawsuits against Valve. The last has been put to rest. (Image: Valve Corp.)

This is the last of several lawsuits that was filed against the Bellevue, Washington-based games giant in 2016.

All accused Valve of facilitating underage, unregulated betting because of the multibillion-dollar clandestine gambling industry that had grown up around the trading of its “skins.”

Hidden Industry

The skins are colorful designer weapons attainable with varying degrees of rarity, or purchasable outright, in the hit game Counter-Strike: Global Offensive (CS:GO).

Skins can be traded like baseball cards across Valve’s Steam platform, which helped give them a real-world, as well as in-game, value. But it was the ability to transfer them to third-party sites that enabled their use for gambling.

In 2015, analyst Eilers & Krejcik Gaming estimated the underground skins-gambling industry to be worth $5 billion. This largely consisted of third-party operators facilitating skins betting on CS:GO esports matches, but also on lottery-style games.  

Valve distanced itself from these third parties, emphasizing that it neither condoned nor profited from them, although the company appeared reluctant to intervene.

But in 2016, as lawsuits piled up, it moved to dismantle the industry, telling the betting sites their Steam accounts would be deleted if they refused to cease operating.

Deceptive Acts?

The lawsuit was brought by a group of parents who had provided use of their credit cards to their children, who unbeknownst to them bought skins for the purposes of gambling.

The plaintiffs asserted that Valve’s failure to disclose information about the ability to purchase skins violated the Washington Consumer Protection Act (CPA).

The court noted that to prevail on a CPA claim, the plaintiffs must demonstrate an unfair or deceptive act or practice, plus injury.

Dismissing the case, US District Judge James Robart said the parents could prove none of the above.

Valve had not committed an unfair or deceptive act or practice because loot-box opening is not “gambling,” as a matter of law, wrote Robart. Meanwhile, the parents were not injured because the accounts belonged not to them, but the children, who chose to spend the money they were allocated on a legal product.

“The parents could not prove they had been deceived by Valve,” said the judge. “[They have] never visited a Valve or Steam website, never used Steam, never played CS:GO, and never saw or read any representations from Valve about CS:GO, keys, or weapon cases; [and] did not know about the weapons case features; and did not know that their children used their money to open weapons cases.

“The court agrees with Valve that no reasonable fact-finder could find that Plaintiffs’ decisions would have been affected by information to which they were never exposed.”