Are there really virtual words *for grownups* (i.e. not Club Penguin) where people are required to speak English? That seems so utterly obnoxious.

MMS is being singled out, I think, only to the extent that they were rather rude and unapologetic about it in the chat transcripts that have been posted. Moderators should be more moderate. :) The real FAIL here is whoever at WB decided to have this policy. It looks just horrible from a PR point of view, and I can't imagine that it actually does any good.

In general, "moderation" seems like a completely silly idea to me in SL. Note that the moderators can do nothing at all about what happens in IM, so having them try to enforce rules over group chat seems completely futile. It's entirely sensible to have people ready to help answer questions, and to have people ready to warn people who misbehave and bother people, and eject them if necessary. But enforcing benign English-only chat? I'm really not getting the threat-model here...