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Lemmy.world seems to have banned the largest piracy community on Lemmy.
(lemmy.dbzer0.com)
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I don't know enough about law to know how that does or does not work, but it that's possible then any entity with enough money can actively bankrupt anyone they want, and it won't have anything to do with why. If that's true could you not just sue someone by making stuff up and force them to prove you made it up?
Yup corrupt companies likely do it all the time. Technically it's perjury to lie in a court but outside of being caught or going to hell it's not much of a deterrent.
There isn't much recourse against that other than trying to skirt detection by these companies (not possible or feasible in the long term) or to be in a country that is strongly against or an enemy of the one(s) those companies are in or allied with.