Why not kill the offending blogs?? Why fuckin sledge hammer the whole damn thing.
The datacenter does not keep root access to the server to log in and disable accounts - Their only recourse is to pull the plug, unless the offending content is something that can wait until the server owner gets around to logging in, to remove it.
Having been in the dedicated and shared hosting industry myself, if something blatantly illegal or against my terms of use had been reported, I would have pulled the plug and then dealt with the situation. Datacenters won't allow themselves to become cesspools for illegal activity, as this just invites more illegal activity, bad press, DDOS attacks, and forced action by government agencies. Look what happened to foonet - The owner (and others, through servers hosted there) took part in a criminal DDOS scheme, and their entire datacenter (including colocated servers) was seized and shut down.
Running free (or paid) hosting services come with an inherent amount of risk to the owner. Not having external backups of a hosting operation is not the government's or datacenter's fault - It's the owner of the free hosting company. Basically, he didn't back up client data, and lost access to it. What would have happened if his hard drive crashed, or server fried (assuming he may have had a backup HD in the server)? Same case - his data would be lost, and the site would be down.
Title should read "Incompetent blog host blames lack of backups on feds",