Sure, this follows the rules, but it seems perverse to lose on a technicality that is easy to resolve with a "hey, prove you own the server. you did? ok."
So either a) Ulbright can't prove he owns the server (in which case he can't very well claim privacy rights in something that's not his property to start with), or b) he is not willing to, even though doing so might keep most of the evidence out of trial. Maybe that's because of some super-clever legal tactic they plan to unveil at appeal (although this seems very unlikely, as this is such a basic procedural issue) or maybe it's for some extrajudicial reason, like because it would reveal the identity of some partner in crime who would then seek terrible revenge. Or any other number of other possibilities.
Yes, evidence is inadmissible based on how it is obtained. However, there are rules and procedures for how you get evidence excluded from a trial. This is why you pay good money for good lawyers: they know the rules for excluding evidence. I recommend watching the 1992 moive "My Cousin Vinny".