TL;DR - Bungie and O'Donnell both went way beyond what they should have done, because of an Activision faux-pas. Everything the OP posted in conjecture cherry-picked and out of context or downright not mentioned by the article.
What the article says, when you read it:
O'Donnell and Bungie bother overreacted and overstepped what they should have done when this disagreement arose but, in both cases, it is Activision's fault. AV could have just used O'Donnell's music in their trailers but decided that they, as the publishing company, would go a different route. Nothing legally was required for them to make this change but they did insult a man in a direct leadership position at Bungie. He went way overboard with his reaction, and then Bungie did the same. Both are responsible for their egregious reactions but is was Activision who, without performing an illegal act, ignored a long-standing tradition and 'unspoken' agreement with O'Donnell.
The problem is the agreement was unspoken, and O'Donnell really did throw a hissy-fit. The other problem was Bungie either had to fire a board member over this churlish display or breach a 10-year, $500 million publishing and advertising contract. If I had to choose between the two you can bet I'd get rid of the malcontent potentially costing me my company, employee base, and product. Forget the fact the owners of Bungie would loose out, the entirety of the employees could have lost their livelihoods. O'Donnells desire for publicity does not outway Bungie as a whole.
That said, Bungie way over-reacted, though you can speculate that Activision pushed them to act harshly as they did. In any case, Bungie legally overstepped what they should have done and were punished for it, as decided by the courts.
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