IMO, the important thing with loose players in tournaments is to figure out when they like to fold their bad hands and then take advantage on that street. It sounds like the one you describe fits well into the 'never' category. Nice.

Given that info, you did right -- tighten up and bet your big hands hard. Just got unlucky that he busted your QQ and TPTK when he'd normally pay you off just the same with weak hands.

Also of note, notice how often other people are limping and/or taking shots at the Lagg. See any opportunities to squeezeplay? Given the fact that he limpcalls a lot pre, another option is you can also limp behind him on the button/blinds/maybe CO with weaker cards in unraised pots early- and mid-game, knowing he'll likely pay off your good hands and that you can get out cheap when you don't like the flop -- think of it as preflop pot control. Of course your other opps might note this and take advantage, so you'll have to be very conscious of other players and such.

But mostly, maniacs lose their stacks to premium hands. Every once in a while they suck out repeatedly, in which case you let em enjoy their time in the sun and then run em over the next 20 games.