I don't know if I've heard of such an extreme case, but hosts are, generally speaking, spineless, and they provide themselves numerous loopholes which, effectively say, "We can shut you down whenever, for whatever reason.". They don't usually have the will or money to fight a lengthy legal battle, so they will usually just comply with strong-armed requests to take the site down. I've never heard of a case of locking the domain, though.
On the other hand, if Wikileaks can provide enough evidence that the reports are true and the evidence supports its case, then it could be a completely different story.
I'm not really certain if the Cayman Islands really care anyway. I mean there IS a reason that people have offshore bank accoutns in the Caymans, and a reason that so many businesses do business as Cayman Island companies. Lack of law enforcement!
As far as the precedent, I think this case is probably unprecedented as far as my knowledge is concerned, with the exception of, maybe, porn.com when it came under contestment as to who actually owned the domain way back when.
9 out of 10 people I prove wrong agree that I'm right. The other person is my wife.
Well, the good folks at Slashdot have gotten into the debate. I generally find a slashdot perspective interesting. They're quoting an info world piece that says in part:
"the bank's solution is so mind-bogglingly stupid, you have to wonder if these guys need help getting their pants on each morning. First, this is exactly the kind of story bloggers and Net-centric journos crave. Big nasty corporation stomps all over plucky public-serving underdog. Who can resist that plot line? Second, the equation Bank Julius Baer = Money Laundering is now firmly cemented in the minds of everyone who has encountered this story, regardless of whether it's true. Trois: The documents in question, which might have been quickly forgotten alongside the 1.2 million others on the site, are now hotter than the Paris Hilton sex video."
I like the plucky public-serving underdog line.
Anyway, it gave me a chuckle. The slashdot story is here: