The “IS Drive”, also known as, ImageShack Drive, allows users to download BitTorrent files to their accounts. The application doesn't actually contain or break any piracy laws, but Apple states that the program could be used for illegal purposes, and have since removed the application from their store.
The $5 application uses ImageShack's torrent services, which requires users to pay a subscription fee, and as Derek says, “Users who are interested in piracy aren't going to pay those subscription fees.” He went on to say that many users legitimately use ImageShack's IS drive for legal purposes, and Apple is punishing not only the author, but many users because others may use it for illegal purposes.
This isn't the first time Apple has removed BitTorrent applications and definitely isn't the first time Apple has accidentally approved an application onto the App Store without fully checking the source code. Many users have slipped passed applications that use non-public API's and have hidden features within them that allow you to do miscellaneous things with them.
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