It would be interesting if a real lawyer would comment but as I read it, if a Internet provider blocked a site NOT "in the reasonable belief" they would lay themselves open to legal action against them.
Banning the DNS may not be as good as taking down the IP, but I am sure that would slow down and signal something is not right. A lot easier to remember
www.stolen stuff.com than 234.56.78.88
Damian is not a pirate, and has said he against piracy, Paul Markham, by making stupid accusations, again destroys another thread that could be interesting.