The thing is, if this becomes commonplace, the Bittorrent protocol will just be modified to avoid it. I've had this happen occasionally - you get hundreds of peers feeding you junk data which wastes bandwidth. Torrent clients automatically ban a client after it sends too many bad parts, so the torrent would probably finish eventually, it'd just be a waste of bandwidth waiting to get connected to a legitimate peer.
Exactly. IANAL, but I'm pretty sure the law doesn't care who you're DDOSing. Making it ok to DDOS anybody is a slippery slope, so I would guess that this is illegal in pretty much any 1st world jurisdiction.
It's interesting that their first client was a Russian film. Looking at my Russian friends, I thought predominately pirate from non torrent sources (vk for instance). Anyone have a good sense of what the Russian pirate scene is like?
Looks like, that this tool is still baseed on traffic analysis. As a result, Bittorrent, probably, will start forcing clients to use secure connections both - to peers and to trackers. And that will effectively kill any traffic analysis attempt.