That does suck, especially since you had nothing to do with it
I assume the virtual server is colocated at another place?
I knwo you said it wasn't you hosts fault, but I'd seriously consider a new host if that ever happened to me.
You'd think the smart thing to do would be to remove that offending person's domain(s) & leave the innocent alone.
This sorta reminds me of GoDaddy & their spam policies - guilty until proven innocent