I really hope they get what's coming to them. Disciplining a student for actions at home. How can you defend that?
My college issues laptops and I work at the help desk for the school. This year, they did come with webcams. However, we don't have any any tracking on them. If students want to install 7 or use them to do on-line x rated stuff they can and as long as it's not illegal (then we care). I could easily see this suit coming to haunt us. Paranoid students are going to come in and complain about nothing. It sucks when one set of people ruins it for the rest of us.