I can't say that I know for certain what I myself would do about a student who had done what the individual in question had done, since I myself am not a sifu/sensei/etc. I can only say that, were I to teach someone, I would endeavour to teach them the ideas of loyalty, respect for others and myself, and moral justification in all things that have been passed down to me from my instructors. A student who violates those principles would be anathema to the very ideals that the martial arts hold to me, and to do nothing would strike me as violating those principles myself.
There's an old saying in the martial arts, much akin to the Spidey quotation posted earlier (a personal favourite of my own, as well!)... and that is that, on the way to becoming a black belt, you learn all the techniques necessary to kill a person, but in actually becoming a black belt, you learn the neccessity of NEVER using those techniques to kill a person. There is always a better way. You fight to defend yourself, your family and loved ones, etc, not to hurt another person unless you have no other choice. I would probably agree with Yilisifu, in being prepared to expel a student who took such actions. Hard choice, but nobody ever said the moral road was gonna be easy.
As for the TKD crack, there's no need for that, folks. I practice TKD, and I like to think that I practice the ART of Tae Kwon Do, not the SPORT of TKD. My instructors always emphasized the artistry of the style, and taught us techniques that were designed to be practical (as in any art, there are exceptions, as certain kicks are more practical then others). Use of one's legs in combat is useful due to the power, speed, and efficiency of using the largest muscles in the human body, and proper TKD training emphasizes the use of the legs in fighting an opponent. This makes it a very valid martial art form. I may joke about some of the goofier stuff that gets taught in the style, and that's valid... every style has its quirks, and I'm sure the comments about TKD practicioners needing a buddy to hold the opponent so we can beat 'em up was not meant to be mean-spirited, but it was in bad taste. Considering the subject matter of the thread, and considering that a large number of people here are TKD practitioners who happen to love our art as much as anybody else here, I for one would appreciate it if people could refrain from making such jokes again on this thread.
--Cliarlaoch