WotLK Help understand this

A guild member of mine was banned while using these raid rules in a ruby sanctum:

Raid Rules MS > OS, Loot distribution and loot bans based on ML's discretion, Raid Lead has 100% power over raid, Trolling will be punished severely.

So my question is: How can somebody be banned for ninja looting when loot distribution is based on their discretion? Yes we have evidence the raid rules were advertised before the raid, before new players were saved before the raid id and we always make sure to let people know the rules before entering. I believe the item in question was an STS not being given to a ret pala who was told he wasn't allowed to roll on it. This is all speculation as we do 25+ raids per week and my guild's raid leaders lead many raids alongside me so we don't know which raid it was but rest assured the raid rules are posted in every raid.