From the very little I've read about this, I believe he includes a small metal bar in the gun to make it a detectable firearm. Now obviously the metal is optional, and the design doesn't require someone to put it in. But I'm not sure how it's breaking the law.
And seriously, if 1 guy can make it, millions other can as well. Depending on the cost and performance, I wouldn't be surprised to see major gun manufacturers venture into this area in the future. Everyone bitched about "plastic" guns (Glocks) when they first showed up, and look at them (and all the other polymer guns) now.
One thing I would be curious about is the weight of a gun like this. While lightweight sounds good for carrying around, a decent amount of heft to a gun can do wonders in making it better to actually shoot.