If the individual who was named in the deleted thread has actually been libelled the complaint (and subsequent action taken by DSG) would seem to be entirely reasonable.
However there is a big difference between an accusation of libel and actual libel.
If this accusation is not followed by legal action the suspicion has to be that this has simply been a bluff and DSG has bought it.
Surprising that DSG didn't even discuss the circumstances with a moderator prior to implementing the ban.