Agree with everyone else, he didn't really break any rules. He can get a warning at most because the only word that came close to a swear was Penis, but was used in general, he didn't actually call anyone a penis :P
And yeah, don't tell him he can get banned, first thats GM decision and second, instead of personally warning him, wait until he swears.
But I agree with you, he was being a very poor sport.