"The responsibility lies upon the user to not spread malicious, false or illegal material using the tracker."
which is tantamount to saying that they turn a blind eye to what's happening on their service. On their legal threats page they respond to various letters. For example, in replying DreamWorks who were annoyed about distribution of Shrek 2 they wrote:
"It is the opinion of us and our lawyers that you are ....... morons, and that you should please go sodomize yourself with retractable batons.
Go fuck yourself."
So basically they either turn a blind eye, or defend the actions of people using the tracker for the copying of copyrighted works without authorization.
If you read the letters they send they claim that they are not breaking the law in Sweden. I guess the court disagreed with that.