Isn’t that what the ‘clean hands’ concept is all about. I know that in a civil case, a person who has committed illegalities in a matter cannot bring suit in the matter.
In a matter of fraud, the court will not hear a case where both parties have committed a fraud, and one party sues the other.
BTW, I agree with your take on it.
The “clean hands” doctrine only applies to equitable remedies, like injunctions. It doesn’t apply to legal remedies, like damages.