I think it was a bit of an overreaction to just let the person die because they used LB in a leveling dungeon. On that same token the individual may think twice before using it later on or you may have just enabled him to be an even bigger douche for other groups.

For leveling content and normal mode Primals I couldn't really care less when or if anyone uses LB, however in HM's I will more than likely expect it to be saved for key moments. LB's can provide significant boosts during critical points in a fight and you typically have many of those in HM's from my experience.