I can find equal numbers of test cases that prove negative SEO works / doesn't work.

The problem I have with all the "evidence" that it works is that it's all usually couched in terms like:

• "I've seen it happen, but can't provide details..."
• "I've heard of it happening..."
• "I know a guy who knows a guy who claims..."

And nobody ever seems to be able to provide anything concrete to prove that third-party link spam does tank a site.

Meanwhile the other side's arguments all cite logically reasonable outcomes but even those claims are presented as opinion and not fact. And worse still while Google publicly espouses that no link spam could/should have any effect on your ranking, Google's very warning seems to be contradictory to that claim.

We may be witness to the first example that should help bolster one side of the argument or the other, but I fear regardless of the outcome, one side will claim Google manually adjusted the penalty or the other will argue that we didn't have all the facts. Something tells me neither will see the results of this situation as evidence to the contrary of their position.