I answered this question from another person recently and concluded it's lawful to watch streamed content even if that content is unlicensed.
I wrote: "In the U.S. it's certainly lawful to watch content that's streamed over the internet so long as the watched content is protected speech -- that is, the content cannot be unprotected speech such as obscene material, child pornography, classified information, etc. -- and so long as the watcher has not hacked into the stream or is otherwise accessing it unlawfully. The person who's streaming the content must determine if it's lawful to do so -- but that's not an issue of any concern to the watcher."
I was quite likely wrong. Even though streamed content is not permanently stored on a viewer's hard drive, the hard drive does "reproduce" the content via its buffer storage process [which facilitates seamless viewing]. Even though "transitory," this storage is, I think, an unlawful reproduction of the streamed content. Courts have addressed this very question so the answer is out there [I just don't have time to look it up at the moment].
In short, I think it's unlawful under copyright law to watch content that's being streamed w/o the permission of the copyright owner.
Will the content owner go after viewers? That's doubtful -- the owner will sue the folks who're doing or facilitating the streaming.
But could the content owners sue the viewers [like the recording and movie industry sued the folks who downloaded content via peer to peer services]? I think so.
The movie was copied in violation of copyright law. Watching it requires making a copy on the computer so that the computer can process it. That copy is a violation of copyright law. While there are criminal provisions for copyright violation, I doubt that his actions rise to that level if all he is doing is watching it.
It is illegal. This is not a close question. It is also likely that someone in the movie industry will eventually start suing these viewers, just as the music industry sued students that download music.