And either way, it's not our place to break the law because we're convinced we know better than the people we're stealing from. If musicians decide to give away their music and make money from concerts, fine, but for the most part they haven't, at least not yet.
And yes, I agree that this incident is problematic, but I think that they've probably done the right thing for the wrong reasons. The law is slowly evolving to meet these 21st century problems, but things take time. I personally don't see a huge difference between a website selling counterfeit goods and a physical store selling counterfeit goods, and I wouldn't have much of a problem with a store being shut down the moment it was caught openly selling counterfeit goods rather than after the trial.
I'm sure I'm missing a lot of details here, and I'm not at all well-versed on this stuff, but I think people tend to be way to quick to defend individual scumbags who are openly and knowingly distributing stolen and counterfeit goods whenever the internet is involved.