Analogy for everyone else:
let's say you are a trucking company. You own 10 large trucks which you use to truck products across the country. You loan out these 10 trucks to 10 different individuals so they can enjoy the use of them while earning you profit, in this case it's a win/win as you're proud of your trucks.
Let's say that someone came up and stole one of your trucks. Suddenly the system doesn't work as well, 10% of the total satisfaction you provide is removed as you don't have all the routes covered. You find a way of changing the other 9 routes a bit, but suddenly the system is slightly less enjoyable with the detours. You start to lose profits over too, due to the nature of the issue.
Suddenly the person who took the truck says "I rode in this truck all the time, it's mine! I put the gas in it, I give it a driver! I even made modifications and I let other people ride in the truck with me." People like the illegal modifications, and some even pay money to try out the illegal modifications. The reality is, the person modified a stolen truck illegally and is making money on it. You, as a truck company, don't want that modification and even made rules to say "no modifications". So you call the cops and get the people out of the stolen truck. Suddenly you have your own truck again, everything is up to 100%... or so it would seem.
But now, while some of your customers understand why you don't put in illegal modifications, because they're illegal, others want those modifications back without regarding to how legal it is. Suddenly what people were 100% happy with before are slightly unhappy. Some of those people get mad at you, the owner of the truck company, for taking away the illegal modifications which you know harm your trucks. They even say "we don't care if your truck was stolen, we LIKED the modifications!" without acknowledging how illegal they were. Others start saying "I know we signed a contract saying we are merely riding along in trucks you created, but because I ride in it all the time, and everyone else owns cars and ride in their cars all the time.. this means I own this truck when I ride it!" Because it worked for the guy who stole the truck in some small way.
Ultimately, what was a solid business before suddenly has a population that doesn't appreciate the fact that they can still ride in trucks, which is something they quite enjoy, but instead are caring about the simple modification that may make the ride the way they want it. The honest reality is, if they wanted the modification that much, they could look for another truck company that offered it and found a way to make it legal or didn't care if it was implemented, but instead they'll stay there and complain about YOUR truck company because they like your trucks.
At the end of the day, this all started with a person who stole one of your trucks, started to make a profit on it, and started a chain of events which, through means not legal in this analogy, made people dissatisfied with a product that still stands by many views as the best truck riding company in the world. In reality, a large chunk of people can't ride your trucks anymore.. which sucks, and a large chunk of people are unhappy with your trucks.
So you decide that you can take this individual to court because not only did he steal your truck, but he performed changes on the truck that are different than originally allowed and then made money on the truck. You want that money back, cause he stole your truck to make it, and you want to ask for reimbursement to damages performed to your truck company.
Analogy quirks:
Trucking Company: Blizzard
10 individuals: Users of the B.net system who paid for their ride.
Paying for the ability to Ride the truck = Getting a license to use the software
Trucks = Generally represent Bandwidth/System Stability/Quality of Product/Codebase
Stealing Truck = Unauthorized use of IP Code to make personal gains.
Illegal Modifications = Hacks
Illegality of said modifications / Law = EULA/Intellectual Property