[MunchkinMan]

The English says that you "may" discard. It's giving you permission to make room for the Item you intend to take by discarding one you have in play. In other words, you must be legally able to play and use the Item you take, and if you already have the same kind of Item in play, you must discard it. You can't turn the old Item sideways to only carry it, and you can't not use the Item you took from the other player.