Bethesda issued permanent bans for several players for apparent homophobia, after they kept making gay jokes while killing a few low level players. It's disputable whether it was a homophobic interaction, but the ban still stands.
AJ and his friends were in the early stages of Fallout 76, as indicated by their level, when a higher level player named NathanTheHicc came up to them asking for a disease cure. AJ helped him out and someone in his group made a comment about Nathan's "cute outfit" that prompted the latter to say he doesn't "fuck with that gay shit" which apparently upset AJ greatly, and sparked a pile of trouble for both sides.
Nathan rounded up his friends and came back later to hunt down queers, or at least mess around with the players as a joke. The joke was indeed immature and griefing is unwelcome in any game. AJ proceeded to report Nathan and his friends via Twitter, since Fallout 76 doesn't have a report system, despite having proximity voice chat that just begs for conflict.
This sparked a ton of controversy due to the apparent homophobia, with some people on the internet siding with AJ and his friends, while others supported Nathan and his friends, all of whom got permanently banned by Bethesda for this incident.
The ban was initially three days long, which may be too light for homophobic slurs, even if they were jokes. On the other hand, permanent bans seem to be too harsh considering it was a joke, albeit an immature one. In an interview with Eurogamer, Nathan further confirmed he does not hate gay people, and that the whole incident was just playful immaturity.
Considering that even AJ's party members initially saw this as a joke, laughing a few times at the comments, and even joking about Bullyhunters later on when Nathan's posse came to shoot them up, it's hard to see this as an extreme case of homophobia. People were aware this was a joke.
It's not a light one though, and Bethesda were right to ban these players, but banning them permanently may have just been a manoeuver to garner some positive press, following the disasters that were Fallout 76 reviews, built-in speed hacks, unfinished state of the game and Power Armour Edition.
The company told Nathan that the three-day ban would be "the only warning" he would get, but the player didn't really offend anyone after that, and Bethesda still changed the ban duration from three days to a permanent one.