That karma system is basically the mute ban system from Reach. It was a weighted system, so people who just spammed the mute button all the time didn't count for much (so you couldn't abuse it by trying to get everyone mute banned). And it wasn't permanent, it eventually wore off and gave you another chance at open chat. I think it should also be optional to follow, so you can either hear everyone by default (hear everyone, mute people on an individual basis), hear all but muted banned people (who you have to manually unmute, also allows for individual mutes as well per your preference of course), or everyone muted by default.