This has been a fascinating discussion
It doesn't work that way. If you buy a stolen car, the police aren't going to let you keep it even if you paid fair market value for it. Unless you track down the person that sold it to you, you're not getting your money back once the police take the car away either.
I disagree with Kabal on this. It is true that if you buy a stolen car or stolen artwork it must be returned to the original owner. But the principle there is different, the stolen items literally belong to someone else and the rights of the true owner are paramount.
The more appropriate analogy would be to counterfeiting money. If someone walks into your store and uses ten phoney $100 bills (that look genuine) to buy some of your merchandise, then what happens? If the police arrive and point out the bills are a phoney, then you must give them up and you are out $1,000. But when the police arrive and you only have 5 of the ten bills left -because you unwittingly used them to buy a washing machine -all they take away fron you are the remaining five $100 bills. They do not confiscate your washing machine.
In real life the priniciples are:
1. The individual who counterfeited, and any knowing accomplices, should be punished.
2. The counterfeit money should be taken out of circulation, even when that results in a loss of money to innocent bystanders who accepted the money as part of an otherwise legitamate transaction.
3. However,when items have subsequently been purchased by innocent by-standers usng the counterfeit money, those items are not confiscated. The innocent by-standers have done nothing wrong, have acted in good faith, and in fact have earned the items that they have acquired -even though they paid with counterfeit money.
Applying these principles to D2:
1. Anyone who creates an illegitamate Diablo 2 item or knowingly uses a illegitimate item should be punished. Punishment can be extended, usually with lesser penalties, to individuals who are innocent but "grossly negligent" just as in real life you might be punished for not noticing that Mickey Mouse was on the counterfeit $100 bills you have been using.
2. Anyone who possesses an illegitmate Diablo 2 item must destroy it, even they they have obtained it innocently.
3. Other than that, there is no foul and no one has to do anything. If you traded ypur Stormlash for a counterfeit Windforce and then used the bogus Windforce on a Bowazon who finds a Tyrael's Might - no problem. When you discover that the Windforce is bogus you give up the Windforce but not the Tyrael's Might. After all, if you had not innocently traded for the Bogus Windforce then you would certainly have taken the next offer for a legit Windforce. You would still have gained a WF which would have allowed you to kill more quickly and would have helped your Bowazon that found the Tyrael's. In other words you earned both the bogus Windforce and the Tyrael's - but you only give up the Windforce and only because it is important to get hacked items out of commerce.
Let's return one more time to Kabal's example - the guy who innocently paid fair market value for a stolen car. Yes, the police do confiscate the stolen car without compensating him. But let's also say that the guy used the stolen car to drive back and forth to his job for a month. Do the police confiscate the wages he earned during that month? Of course not, how silly!
And that's also how silly the SPF rules are about "tainted" items.