If this was someone who just downloaded the game this would be a big deal, but going by that article, this guy had a tleast some involvement in the wii hacking scene and was the first to upload a major game for distribution. I'm not sure how Nintendo figured out he was the uploader, but frankly it sounds like he was sloppy about it and got caught.
Demon's Souls Official Thread | Currently playing: Left 4 Dead 2, LittleBigPlanet 2, Magicka