Students here get busted for illegally downloading & sharing movies, music, etc online all of the time...we're talking multiple cases every day.
For a first offense, a warning gets sent out, they are told to bring their computer into the office and the illegal file gets removed and any file sharing software gets removed. A second offense and it's the same process, but they also have a meeting with the Dean, and a third offense has them possibly getting kicked out of school and turned over to the wolves where they can get sued for thousands and thousands of dollars per title.
People are stupid.
One case had a kid download Transformers 2 the other day. This movie is available at just about any RedBox, for $1...ONE DOLLAR...and if you use a free code, which you can get online (ahem...BREAKROOM...try it for a free movie) you can rent it for free...FOR FREE!
And if the idiot wanted to "have" the movie, he could always copy the damn thing and have it on DVD, which would probably be better quality than the download anyway...and his chances of getting caught doing that are slim to none. But he chose to download & share the movie on the school's network, which is monitored.