Phaedon wrote...
Shepard is an Alliance soldier or citinzen in both cases. An Alliance court martial is the only thing that makes sense.
If Shepard is a Spectre: Everything that happened was outside his/her jurisdiction, the only people who commands them is the Council and they'd have to handle it. Rather than the Alliance, which Shepard doesn't technically answer to, handling the situation.
In addition to this, having Batarians threatening a war with all of humanity (which may be the entire Council or a representative) would lead to the Council do what's best: scapegoat. They've got a history of scapegoating other people / species to protect their interests, a Batarian war isn't in their interests.
If Shepard isn't a Spectre: Shepard has to answer the Council AND the Alliance (which Shepard isn't part of anymore), the Council might judge him/her as an enemy of the Council (which the Alliance is part of), having him be shunned by the entire galactic community shows that even the galaxy's hero isn't safe.
Both: The Batarians already don't respect the Council, it wouldn't be out of the question for the Paragon/Renegade Councils to try and use Shepard's trial as an olive branch to the Batarians.
Symbolically? Earth is the best place, then, symbolically, because it shows that all humanity wants Shepard down, not just Alliance HQ.
Or they might view it as the Alliance trying to ignore Shepard by not dealing with him(her) themselves in their own political building with their leadership by dragging him to a planet where the Alliance doesn't have much involvement as a whole.