You can read their comment here for more info, but essentially the report is bunk, at least according to LJ. I stand behind the other 99% of my post, which was less about how awful LJ is and more about how to keep your head, back up your data, and if desired move to a site where we don't automatically, because of their past behaviour, jump to the conclusion that they're evil. :D
Thanks to everyone who commented with info, too. More knowledge is always better than less, except when it leads to nuclear arms races and five different Hulks.