"Against some law somewhere" doesn't necessarily qualify as piracy either. Though they may label it as something else. But we all know this isn't a discussion about legality (which is shaky ground when considering "what's right/what's wrong" anyway). It's a discussion about how modding isn't creating a headache for this or any other dev. If anything, it creates (self imposed) headaches on modders who then have to support their mod.
Exhibit A. Read the zillions of posts to these thousands of mods.
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And if anyone tries to tell me that modding hurts games sales... Look at Skyrim. Or even this game/genre. I probably wouldn't play this kind of game without modding, so it earned this dev a sale. And the modder some cash as well.