Anyways it doesn't matter if this is illegal or not. It's already caused an uproar and backfired pretty badly. Anyone with half a brain could have seen this coming.
A really bad move by MS to allow this to happen especially after the year they just had.
They are once again shooting themselves in the foot.
If this is true we will most likely get an apology from Major Nelson saying something along the lines of "we didnt have any bad intentions we apologies for the misunderstanding", which is all great and stuff but they can really only say that so many times.
MS needs to start playing the game smarter. At least if you do something like this don't get caught out?