In general I think it is a very bad idea to give this kind of policing power in the hands of private companies. They tend to be very conservative to avoid legal liability and they can also take arbitrary decisions. When Cloudfront decided to cutoff the Daily Stormer they crossed a line and many people were justifiably upset. It's the job of the legal system.
The real problem is economic; for any given ISP, they are going to side with their customers over some rando complainer most of the time. You don't get rich by disconnecting your own customers unless you absolutely have to.
Sometimes, this is good, if you're the one who might get disconnected (Cox was a great ISP to have, because for many years they would blithely ignore Bittorrent complaints and give you a dozen or so 'strikes' without consequence); it's awful and obnoxious if you are on the receiving end of an attack, and some shitlord low-budget VPS reseller or datacenter operator won't unplug the control server or whatever, or drags their feet to a ridiculous extent.
All about whose ox is getting gored.
Sure, that seems like it could never be abused at all.
As others have stated this isn't about blocking content, this is about cutting off an entity that was actively damaging infrastructure.
https://fightthefuture.org/article/the-new-era-of-corporate-...
Were any honest actors harmed by this 'shunning'? Seems unlikely that this 'Bitcanal' web-hosting company was used exclusively by malicious parties.
Also, if this 'shunning' idea were to really catch on, couldn't it end up colliding with net-neutrality laws?
Bad actors can often be identified. Their upstream should just disconnect them. Or their upstream should. Draw a boundary around them and their intransigent collaborators, and cut them out of the network like a cancer.