That seems extraordinarily foolhardy to me. When my hard drive fried I needed to download a few Linux and FreeBSD distributions. That was easily in the many gigs in a day. I would have been absolutely flabbergasted had my service provider shut me down in the middle of my transfer. And, I assume that my service provider (or Verizon) would soon have very few broadband customers, or be overrun with "action items" requiring them to violate their customers' privacy by checking on what they were downloading if they took Ms. Loizides' advice.
Later:Not to pick on Ms. Loizides, but her most recent web log entry also has this to say about the decision: "Under the law, Verizon lost their bid to re-define themselves." While I agree with her proposition that definitions matter in law, the Verizon decision was not about Verizon trying to redefine itself or fit into a different sub-section of 512. The court found that the type of service provider that Verizon is (512(a)) doesn't matter for 512(h). Any type of service provider under 512(a)-(d) must respond to a 512(h) subpoena.