This is another of these growing pains the modern world is having to go through. A court in Germany has decided that the owner/proprietor of a Wi-Fi connection is partially responsible if said connection is used for illegal purposes, with or without the owner’s knowledge. Therefore, leaving a Wi-Fi connection open to all comprises a sort of negligence, criminal negligence in fact, punishable by a fine.
The fine wouldn’t be large (€100/~$125) but the fact that it’s there at all is kind of backwards. Free and open internet access is a controversial subject, mainly because of the increasing number of crimes possible online, and the easy means of anonymizing access. There are privacy concerns here, and legitimate security and copyright ones as well — far more than a criminal court (deciding a single claim by one musician against one user) has power to decide over.
The ruling has been made, but I doubt it will stand for long. A more nuanced law will have to address this — one establishing a reasonable level of protection for your network, or levels of “complicity” should more or less serious crimes be enacted through your connection. In the meantime, our German readers would do well to set a password on their home network, just to be safe. I doubt a task force will be going around knocking on your doors, like they did in Mumbai, but you can never be too careful.