As I said in my post to DrDemento, copyright law establishes different levels of infringement, ranging from a minimum of a $500 fine for "innocent" infringement to a maximum of a $100,000 fine for "willful" infringement.
But, since the inception of copyright law, policing every instance of copyright infringement was difficult. The Internet makes it completely impossible.
But it also makes it possible to act swiftly: an email to a lawyer, a quick glance at the offending material, a cease-and-desist pulldown email to the offending party and the hosting website. Material pulled.
When the director (or sock puppet claiming to be the director) said in this thread that he altered the material (and didn't he say that he HATED it too?) elevated the situation from the level of the little girls singing "Popular" and the bad singers singing "Send in the Clowns" (neither of which would ever be prosecuted, but if they were it would clearly be "innocent" infringement) to the level of willful infringement.