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More interesting than the legal ramifications: are they right about improving security? If you were a customer of theirs during the blocking you would have two options: go outside or buy wifi. Presuming they had decent security, would this not have stopped all those "suspicious_hotspot is nearby with 4 bars, do you want to use it" situations? Was the security reasoning behind this legitimate? (Obviously it's a money-grab, they could've given the wifi out for free in dozens of safe ways, but maybe their logic isn't entirely unsound.)

Then again, hotel wifi is about the most holey, vermin-infested place you can connect to the 'net. I'd be shocked if they actually had good security. Anyone ever stayed there while this was going on?