I don't understand why the CEO was uploading illegal files. Seems like the worst possible thing he could have done -- really kills any "we're trying to provide a legal service; not our fault our users are uploading copyrighted material" arguments. The safe harbors won't protect them if this is true.
I remember hearing Shawn Fanning say he never shared anything illegal on Napster.
I think the assumption was that the uploading of files to Grooveshark was covered by the DCMA's fair use clause. I guess he was confident of their model and its legality.
I remember hearing Shawn Fanning say he never shared anything illegal on Napster.