The ONLY time it is illegal to do something with copyrighted anything is when you profit from it. You can edit whatever music you wish and make it available to people just so long as you are not profiting from it.
The gray area to making it available on the internet is the site you download it from makes money off of its web ads which in turn can be tied to making a profit off the music since technically it is the music bringing the person to that page to download it and webmasters get paid usually per hit on thier sites.
Worst case scenario is the file is removed from the site.
Sorry to bust everyone's bubble but that's not 100% accurate. What Running is doing, while kick a$$ in it's own right, is technically not legal.
The problem is he's making the copyrighted material available for anyone to download. Fair Use dictates you can do whatever you want to copyrighted material you purchase...make a mix tape for your car, mash up a song in a remix, play for a friend, etc...as long as it's for you and only you. The minute you make that material available for others, it's copyright infringement.
Also, a common misconception is to claim Fair Use if you're not making money from the distribution. Problem with that is, by making copyrighted music free to the public, you're taking money out of the owner's pockets. Why buy it when you can get it for free?
As for DJing and public performance, like someone else mentioned in this thread, it's technically not legal to "broadcast" music in a public forum but that isn't really enforced by record companies since you can't take a party home with you. Think of it like the "This broadcast of the NFL is prohibited for redistribution..." message before any sporting event. Bascially, the bars are breaking the law by playing it but nobody really cares. So, your friend can feel free to re-mix and play music at parties as much as he wants.
One last thing...if Runnin' took small snipets of the songs in question and made an "In Game Mix" available to the world, that would be waaay more legal than using the whole song. Fair Use dictates you can use snipets of copyrighted media, which legalizes most hip hop samples, reviews and ::ahem:: message board news threads. If a record company took you to court, you would probably still lose, but you would have more of a case.
All that being said, thegame is right when he says the worst that will happen is they remove the .zip from their server. Also, I can't dl the zip from work, so I'm not sure if you used full songs or not...if you didn't, then disregard my ramblings!
Edit : Just reread the thread and Runnin' did mention he was taking clips, which is definately "more legal" than jacking the whole song. I believe the law is somewhere around 15 seconds but I'll have to look that up. My whole point of this post was the whole "If you're not profiting, it's cool" vibe...that is most certainly not the case.
Edited by Bulletproof, 25 March 2009 - 04:11 PM.