It's a civil court where these cases are going.
True, this story is about civil court lawsuits being filed. However I would wager that the "settlement offers" do explicitly raise the threat of criminal charges and prison if you don't give them the money they demand.
Having people think something is crime that can be prosecuted in criminal court when it is demonstrably not so
False. The 1997 NET Act in the US did in fact make most copyright infringement into a felony. In particular the NET Act slipped this cute redefinition into law:
101. The term "financial gain" includes receipt, or expectation of receipt, of anything of value, including the receipt of other copyrighted works.
Any use of Bittorrent or any other P2P pretty much by definition "includes receipt, or expectation of receipt, of anything of value, including the receipt of other copyrighted works". It is also quite easy for offline non-commercial infringement to fall under that definition.
The NET Act adds the following criminal law:
506. Criminal offenses
(a) Criminal Infringement.--Any person who infringes a copyright willfully either--
1. for purposes of commercial advantage or private financial gain, or
2. by the reproduction or distribution, including by electronic means, during any 180-day period, of 1 or more copies or phonorecords of 1 or more copyrighted works, which have a total retail value of more than $1,000, shall be punished as provided under section 2319 of title 18. For purposes of this subsection, evidence of reproduction or distribution of a copyrighted work, by itself, shall not be sufficient to establish willful infringement.
Note that that is an "or" situation. Under the first clause, even a single minimal infringement is defined as a criminal act if it falls within that crazy redefinition for "financial gain".
The NET act also defines the criminal penalties:
Criminal infringement of a copyright
(a) Whoever violates section 506(a) (relating to criminal offenses) of title 17 shall be punished as provided in subsections (b) and (c) of this section and such penalties shall be in addition to any other provisions of title 17 or any other law.
(b) Any person who commits an offense under section 506(a)(1) of title 17--
1. shall be imprisoned not more than 5 years, or fined in the amount set forth in this title, or both, if the offense consists of the reproduction or distribution including by electronic means, during any 180-day period, of at least 10 copies or phonorecords, of 1 or more copyrighted works, which have a total retail value of more than $2,500;
2. shall be imprisoned not more than 10 years, or fined in the amount set forth in this title, or both, if the offense is a second or subsequent offense under paragraph (1); and
3. shall be imprisoned not more than 1 year, or fined in the amount set forth in this title, or both, in any other case.
So the penalty is up to FIVE YEARS in prison if you have uploaded or downloaded 10 or more infringing files during a half year. The penalty is up to TEN YEARS for a second offense.
Oh, and if it's only a single act of infringement of a single file, then the law is much more generous with you, the crime is merely a felony with up to ONE YEAR in prison.
If you somehow manage not to fall under the "financial gain" definition, 506(a)(2) still makes infringement a felony if the infringement has a total "retail value" of $1,000 within a half year. In that case the prison terms are merely three years if it was ten or more copies with a total retail value of $2,500, six years on a second offense, or merely up to one year in prison for a non "financial-gain" infringement with total claimed retail value under $2,500.
Probably about a quarter of the entire U.S. population are technically unindicted criminal copyright felons subject to one or more years in prison. We would need to build a prison larger than any state, to hold the close to a hundred million felons.
If this law were actually to be enforced the government would be overthrown overnight. The entire population would take to the streets and just toss the entire government our, as virtually everyone would either be a felon or a close friend/family of a felon.
And for those of you outside the U.S., don't be so quick to smugly laugh at crazy American criminal copyright law. The E.U. and many other countries have passed equivalent criminal law. Outside the U.S. the phrase "commercial scale infringement" is often the code words to criminalize essentially any non-commercial copyright infringement that touches the internet.