It is likely due to automated filters scanning 1000's of chat logs each day gets false positives. Guild name/Pirate name review I believe is a little less automated, with some although perhaps limited, human review/intervention/approval.
As for the what do you sue the kids for...
Where are the parents that are supposed to be monitoring this childs internet activity?
Its not the internets job, the parents are ultmately responsible, to what degree, the legal system would have to evaluate the situation accordingly.
Zeppers lvl 40 - All mastered but lvl 21 cannons
Groggy McJones lvl 26 - All weapons quest/tp quest finished - avoiding story quest
http://pirates.teamofx.us