In a private demonstration with The Chronicle, a representative from the Recording Industry Association of America explained the simplicity of nabbing file-sharers, specifically those located on college campuses.
Rather than using some complicated method of analysing data travelling in and out of universities to see if it contains copyrighted songs, the RIAA simply goes straight to the source of file sharing: LimeWire. The RIAA commissions Media Sentry to do the hunting. In a completely automated process Media Sentry then runs searches for RIAA-protected songs on LimeWire and grabs the Internet protocol address of those sharing. It will then cross-check the IP to see if it is from a university and then send take-down notices. It's as simple as that.
What makes the process interesting is how the songs are verified. Everyone that has downloaded MP3s has encountered a song that doesn't have the right name. To combat this, Media Sentry checks the file's hash, which is like a digital fingerprint of the song. If the hash is a mismatch, the song is downloaded and checked using audio equipment. So yes, the RIAA approves for a third party to pirate its songs to bust file-swappers. Pot, kettle, black, anyone?
The fact that LimeWire is one of the most popular peer-to-peer services for file-sharing and that it publishes the IP of the sharers publicly makes it a no-brainer for hunting down offenders. It's not confirmed why the RIAA is putting so much pressure on universities, but I would imagine it's because of the sheer number of violations and the ease to regulate by going straight to the university rather than having to wrestle with Internet service providers.