This is silly. Colin clearly isn't going to "litigate" against you. He provides the source precisely so that people can find bugs in it. It's a commercial product, though, not a GNU project. It's a good thing that he provided source code, and it's disingenuous and petty to try to punish him for doing that.
Why not just have a non-compete clause within the license. At least legally this would allow for internal use with local backups. I highly doubt execution of a similar service using tarsnap would even happen, if that's what the worry is.
Presumably because he has better things to do with his time. His commercial competitors universally do not release their source code at all. Stop picking on him for his license.
