Yes they literally can lock any device you plug their SIM into, if they want to. They used to, but it's uncommon now.

They do that to a device that I own without providing the service for free for the entire period, then they're getting sued. They have absolutely no right to claim ownership over my fully paid device.

And they typically don’t these days but there’s no technological prohibition and it was common a decade ago.

how do eSIMs enable locking arbitrary devices to a network?