There's nothing to indicate that Microsoft was legally obligated to suspend their service in this case, is my point.
They're not legally obligated to deny their services to customers who have legal disputes totally unrelated to their contract with Microsoft.
It's like getting the power company to cut your electricity because you have unpaid parking tickets - It's probabkly a great way to get parking offenders to pay what they owe, but it undermines trust in general, yes?