Rapidshit refers to files shared by someone who abuses a file sharing service for personal gain. This can come in the form of money or gifts from the site such as free accounts and merchandise. It does not require that the files be on Rapidshare as virtually any file host when used alone can cause this problem.
Rapidshit is usually many small files using a single file host, often a multipart, password protected solid archive. The original poster's primary concern is maximizing the rewards he receives through that host. He flags any attempts to reupload to other hosts and threatens to stop posting when that happens.
Meanwhile, all of the contributors who either use torrents or distribute files amongst multiple hosts feel insulted because of this obviously unequal situation. However, within any community the leechers always greatly outnumber the contributors and they always take stuff for granted when it's free.
In the end, all of the contributors are banned and the Rapidshit poster has an effective monopoly on content. He makes downloaders do more and more to get content, and soon enough there is hardly any content at all. The community is effectively destroyed and the contributors make a new place only to see the process start all over again.
Rapidshit is a plague on any community and should not be tolerated.