Especially when you consider that the first failure mode should be to
ask for clarification if you are unsure. It's completely unreasonable for them to claim they read the rules, and upon their singular reading of the rule, they
were completely sure that the limit was for individual participants and not whole teams. That there was not even any microscopic amount of doubt that maybe, just maybe, it was for whole teams.
This sounds like they are trying to cover their malicious intent with an "it's better to ask for forgiveness than permission" kind of trick.