Hmm... some of your other comments read like they were written by a PR firm, (take that as you will) and in this one it seems that you are being deliberately obtuse. At best it seems like you are arguing a technicality.
I'm not in any way defending the actions of MU, its founders or staff, but it had only be established that such devices were legal a year or so before the iPod was released. At the time there was no way to legally purchase MP3- or AAC-encoded music from any of the major recording labels, so the idea that selling those devices (and distributing an MP3 encoder with iTunes for free) was inducement to infringe copyright on a massive scale wasn't so obviously without merit.
