They were overselling like crazy so I assume they couldn't keep up with the bills when a new server was needed or they couldn't keep up with customer support.

Any way you look at it, this was a very low class, scumbag move.
They could have easily acted professionally and relocated clients to other providers, but instead they chose to act like a bunch of midnight rats and scurry off leaving their clients high and dry.

It's scum like this that give the hosting industry a bad name. They have tarnished the industry and should be held financially responsible for all of their clients losses.

I hope their clients pursue legal action.