Damn - Update
Mondo Kim's was raided by police for piracy, with five employees taken away in handcuffs. I think I visited Mondo Kim's once when I lived in NY (I was a more frequent patron of Kim's Underground on Bleecker) but the idea of them getting raided is kind of chilling.
More details emerge regarding the raid on Mondo Kim's. I've been out of town and am just catching up with this. Lots of speculation about label involvement and confirmation of RIAA and MPAA presence. Although the allegations made by officials are focused on the production of bootlegs, the charges (trademark infringement and failure to disclose the origin of recording) are labeling offenses that require only that the offenders be aware that they are vending illegal materials, rather than making them.
Frankly, the idea of the RIAA seizing mixtapes is bizarre. To pick the obvious example, 50 Cent's multi-platinum status was guaranteed by his notorious mixtape success. Kelefa Sanneh makes note of some of the ironies in this piece in the NYT.