I agree that it's an extreme step, but given that the creator of the work was trying to use it to extort both the Tolkien estate and Amazon, confiscating the work to prevent further abuse is understandable.
Also, the book was submitted as an exhibit in the court case, so you can read it there. It's genuinely awful. Nothing of value is being lost here.
https://storage.courtlistener.com/recap/gov.uscourts.cacd.88...