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Incidents like this remind me that when you play WoW or other mmorpg's, you don't own your character, despite the often thousand of man-hours people put into them. It seems to me that if there was a similar real-world analogue, the account holder would be able to get some sort of redress to his losses in a court of law, or at least reinstatement. In these virtual worlds, the game company is able to rule by diktat and is able to twist the TOS to suit their needs. Indeed, they can change the TOS at will and if you don't agree to the new terms, then you forfeit your right to your account. Eventually, the legalities of virtual worlds will need to be addressed.
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