After talking to Teralogix, it seems this was the result of an overzealous legal team and a novice marketing lead on the project--as opposed to well informed and well orchestrated deviousness on behalf of the organizing company.
I agree, applause for those who discovered the clause, but the better outcome would have been for Teralogix to do it right. Sadly, that didn't happen either.
Every employee is a representative of the company. That includes the legal and marketing departments. And it is indeed, as another commenter calls it, lame for persons outside those departments to use them as an excuse. It's their responsibility to communicate with their colleagues and present a consistent face of the company. I know little about Teralogix, but from reading of this little stunt I am not sure I want to. Extremely unprofessional.
That's still an incredibly lame excuse. Someone took the time to write that language into the contract, and whether through malice or inaction, no one corrected it. It's unforgivable no matter who you point fingers at internally.
I agree, applause for those who discovered the clause, but the better outcome would have been for Teralogix to do it right. Sadly, that didn't happen either.