Just because one side says so?
Because that side has a big brand name?
That is exactly what I mean with "Whoever has the highest reputation is right".
The initial promise of crypto was the opposite: That the little Joe has the same rights as the big guys. Because code is law. And code does not care about the budget of your legal department and your marketing department.
If you can't accurately predict the implications of the lines of code in a smart contract, then it's as good as saying "The laws of physics are laws. That ball ended in my garden following the laws of gravity and thermodynamics, asking for me to return it to you is breaching the initial promise of the physical world". This may change with better smart contract languages that can reconcile intent with effect[1], but while talking about complex Ethereum smart contracts, the "Code is law" argument has no value.
Furthermore, as long as you keep within the bounds of trustless cryptocurrency (unfortunately not a tautology these days), code is indeed law. The ETH this person acquired cannot be confiscated.
That's only because there's no ETH. All there is is a ledger. And ledgers can be "ammended", as they have been in the past, effectively stealing the hacker's ETH back.
Theoretically you could write more precise laws with code.
Maybe they should have let a group of contract lawyers proofread what the code does. Lawyers look for bugs, inconsistencies, errors, loopholes all the time.
This happens all the time in traditional written law. Legalese exists for this very reason.