Yes, downloading copyrighted material is illegal.
Based in Oregon, Carl Crowell is a lawyer who specializes in tracking down pirates who use torrent software to obtain intellectually infringing material.
Crowell has filed numerous lawsuits against pirates in the United States. Most often, however, suits filed by the lawyer never reach the judge as downloaders, frightened, pay damages and settle out of court.
The lawyer has won 80 cases for his clients so far, with many pending -- and the typical settlement reached is $7,500. However, Crowell does not indiscriminately hunt down targets; instead, he targets the worst offenders who keep torrents alive.
He is generally successful -- and therefore is in high demand by creators protecting their content.
In order to combat intellectual property theft, this seems like a reasonable approach -- we've seen nine-year-olds having their PCs confiscated and parents fined, while teenagers are hit with heavy fines.
http://www.zdnet.com/article/torrenting-is-never-anonymous-pirate-chasing-lawyer-claims/