I don't think it would work but I'm sure the plan is illegal if only because it would not work unless they removed DRM before uploading. No new laws needed.
The second problem is that it would garner way too much unwanted attention. It makes a perfect way to publish bomb making instructions or other criminal activities. Police, anti-terrorist and state intelligence agencies would demand access to a list of all users on the system, their point of origin etc.. Sooner or later a court order would be issued to grant access to someone claiming infringement.
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