We don't know all the facts yet, but there's one surefire way to get terminated:
> If you attempt to cheat the system (for example, by trying to trick the review process, steal user data, copy another developer’s work, manipulate ratings or App Store discovery) your apps will be removed from the store and you will be expelled from the Apple Developer Program.
So we can probably safely assume it wasn't a glaringly obvious or serious breach of the terms that Apple felt it could defend. I don't imagine Apple would make cost benefit decisions about who can break their terms of service with nothing more than a letter with a legal letterhead.
That being said we will know for sure as the plaintiff seems to be bound to make Apple foot the legal bill one way or another. Good for them.
I hope they get a multiplier on their damages. $725,000 for 4 months of downtime for 7 people doesn't seem like enough.