(1)
Yes. It is only logical to say that it is possible for a subdomain that is deploying SEO tactics that warrant a penalization by the search engine to have the potential to spread that penalty across the whole domain. This is the current discussion taking place at HighRankings Forum.
The logic is that the owner of the domain (at least in most cases) have exclusive rights to the sub domain names under the master domain name. Someone told me, just two weeks ago, he received an offer from an individual who wanted to buy subdomain names from his master domain name. Of course, the individual who owned the domain name rejected any offer. The bottom-line, in this case, is that the master domain name, owner is responsible for any sub domain under the master domain name.
Ah, but you ask...What about a domain name used for a secure site purposes? Or for a shared shopping cart solution? Often you see sites switch over to a subdomain of a completely different master domain name, during the check out process. Would a search engine ban the whole domain name, if the master domain in that case is widely used? Possibly no, but I see no reason why they should not. (1) Most of those cases, the content in those areas should not be indexed (secure site area, https) and (2) It is still the master domain owner's responsibility.
