They have no chance of winning unless their console genuinely isn't modded.
Live is a service, like PSN or the wii service, you pay to use the service, its not a right of owning the console (hence the agreement to agree to to use the service)
You (the person who was banned) broke the contract so was banned
Simples.
_________________TwitterCharlie Brooker:
Macs are glorified Fisher-Price activity centres for adults; computers for scaredy cats too nervous to learn how proper computers work; computers for people who earnestly believe in feng shui.