This is damaging to the client. Yes, they may have deserved it, but will future clients be discouraged by this behavior?
Edit: To be clear, I'm not saying the coder was in the wrong in any way. That is to be determined based on whatever agreement existed between the coder and client. I'm asking if as a business decision it was wise to release the work. The client now has all of the work, and there is no possibility of reconciliation.