Yup. As Gideon said, it's sort of somewhere in the middle, though more towards the legitimate side. Think of it as YouTube for text. People are uploading anything and everything, and the site is trying to weed out the copyrighted stuff if they're informed of it.
Also, to further muddy things, they've recently signed some deals with publishers in an attempt to become even more legitimate. But remember that just because you found something there, it doesn't necessarily mean that it's in the public domain or that you can legitimately download it. Which means grab it while you can, cos it may not be there tomorrow.