This is an interesting double-edged sword, because I can see both sides of it.

In this case, without even knowing the details, I'm pretty sure the reviewer was right and the company was wrong.

However, bad reviews can be devastating to a company, especially a company/product that isn't a huge seller, and thus the overall number of reviews are low.

Certain bitter or unfair customers can go on a SixToedPete-like vendetta and really ruin a company just with some convincing-sounding bad reviews.

At the same time, there are a LOT of shady companies out there (especially selling on the internet), and the power to give bad reviews is really the biggest weapon at the consumer's disposal. In cases where I've been cheated and/or treated disrespectfully by a company, the first thought that goes into my head is, "Well, at least I can write a bad review and let the world know about my experience." Without that power, companies get a way with a ton of shit, as most people patronizing them would otherwise have no way to know about others' bad experiences.

I feel that every consumer should have the right to post fair and honest reviews. I feel that lawsuits should only come into play when there is clear malice and/or clear misinformation in the reviews.

For example, in the case of this router, if the reviewer maliciously wrote, "This router will upload malware into your computer, and your identity will get stolen", that shouldn't be allowed unless the reviewer has proof of this. At the same time, if the review is something like, "This thing is a piece of shit. It constantly fails to connect to my laptop, and it just loses connection spontaneously", that's the reviewer's own experience with it, and unless the company can prove he is falsifying it, the review needs to stand.

Anyway, good for Amazon for banning that company. Amazon is actually a very customer-friendly company, and I recommend them.