I didn't understand it when this lawsuit first popped up either.

But the fact is, Valve run a loot box mechanic and a storefront where the items in loot boxes can be traded and purchased with store front currency. That might not be problematic except that you can use that shop currency to buy actual real world products like the steam deck and controller. So there's an avenue to monetary gain here that is first party and that's the problem.

I like Valve generally as a company but this does in fact appear to be illegal.