I was reminded of this slashdot article after seeing all the fuss over Dave Winer shutting down his service. Dave Winer's actions remind me a lot of this web host's actions (though Dave has not been arrested for extortion as a result) and both stories appear to be slight precidents to traditional property laws creeping their way onto the internet. You know, squatting rights and rental agreements and all of those.
Here was my reply in the comment thread to that slashdot article (which a week later appeared to get modded up to 2! go me :) You should probably read the slashdot article, and the original and maybe some of the other comments, before you try and make sense out of my reply.