Valve has asked the Washington State Gambling Commission to clarify its legal allegations about the company's relationship to skin gambling, stating that it "[does] not understand the legal or factual position supporting" the Commission's case.
In a letter sent yesterday by legal counsel Liam Lavery, Valve directly responded to a proposed threat of legal action over the rise of illegal gambling with Counter-Strike: Global Offensive skins. The State Commission highlighted $1 billion changing hands for CS: GO skins on a single site in the space of seven months, all connected to automated Steam user accounts. This "unregulated black market" was described as a cause of great concern, particularly given the "heightened" risk of underage gambling around eSports.
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As requested by the State Commission, Valve has responded with an explanation of its position, and the owner of the Steam platform has emphasised its distance from this illegal activity. "As we have explained on multiple occasions, Valve is not engaged in gambling or the promotion of gambling, and we do not 'facilitate gambling'," Lavery said in his letter. "The operation of Steam and CS:GO is lawful under Washington law. We were surprised and disappointed that the commission chose to publicly accuse Valve of illegal activity and threaten our employees with criminal charges.
"Valve has no business relationship with such gambling sites, and indeed they can come into existence, operate, and go out of existence without Valve's knowledge"
The letter also said: "Outside of Steam and, we believe, outside of the United States, certain websites offer gambling propositions. Valve has no business relationship with such gambling sites, and indeed they can come into existence, operate, and go out of existence without Valve's knowledge."
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Fundamentally, Valve's position is that the mechanisms that third-party Steam accounts use - in-game items, Steam trading and OpenID - to facilitate skin gambling do not transgress any laws, which undermines the State Commission's main argument - as Lavery described it, "Valve could stop this, so it should." Lavery also noted that Valve has taken action against third-party gambling sites in the past, such as the 23 cease-and-desist letters it sent in July this year. He said, "Valve can enforce its user agreements against the Steam accounts of skins gambling sites, where we can identify the site and identify the corresponding account."
The letter closes with a plea from Valve encouraging, "further communication with the Commission, if it would like to clarify the legal allegations against Valve, or alternatively to work with Valve to identify offending Steam accounts of gambling sites."
Valve's belief that the State Commission has "no factual or legal support for [its] accusations" was lent credence recently when a federal judge in Washington state, John C. Coughenour, threw out a proposed class-action lawsuit brought by players who had lost money gambling with CS: GO skins. “A disappointing gambling loss after receiving what was paid for is not injury to property sufficient for [a case],” Coughenour said, as quoted by Polygon. “Taken together, it is clear that each time plaintiffs played they received an opportunity to win and received a benefit of their bargain."
The full letter from Lavery to the State Commission can be found on Tech Raptor.