The Judge felt that by wiping the hard drive in question, he was destroying evidence. Even if the man had a real reason for wiping his machine – many of us do that several times a year – it was still a poor choice at this point in time. All things being equal, he shouldn't have even been using the machine. It definitely ruined his case.
At the very least, it serves as a warning to others who the RIAA is trying to strong-arm – don't destroy your hardware or wipe your drives, even if it has nothing to do with them.