Trackers are usually relatively well known and traffic to those specifically may be dropped
Otherwise, packet inspection on network devices should be able to discern the traffic.
I'm not well versed in this area anymore, but you can tell from the contents/patterns of packets that this source and that destination are using a given protocol.
I don't believe this type of traffic is encrypted - and the VPN provider has to decapsulate the traffic at some point :)
I heard sometimes they are part of the peers upload/downloading the torrent content and they just get a list of all the other peers they're connected to and send DMCAs to each of them.
edit: I misread your comment. I was talking about the copyright holders not VPN providers.
The fact that they lost a court case, rather than the users, says something about their implementation. There were several VPNs where this was not the case.