Yes. All 6 players on the LOS (the two respective trips sets) and the two players off the LOS flanking the Snapper went down field. 7 of those 8 ran vertically and from the left trips set one receiver ran a hitch/stop round about 10 yards down field.
For a legal formation, you have to have 7 players on the LOS. The last 2 players on each side of the line are the only eligible receivers that are on the LOS, permitting they are wearing eligible numbers (1-49 and 80-99). Since 7 players are required to be on the LOS on every play, the maximum number of eligible receivers you can have is 6 including the QB, so there should really be a maximum of 5 receivers downfield on a forward pass beyond the LOS (the 3 in the backfield not including the QB/punter, and the 2 on the ends of the line).
Right off the bat, you said there were 7 players downfield. If that's the case, just from a pure numbers standpoint, you have
at least 2 ineligible receivers downfield. Now looking at your play as you described, if all 6 of the "receivers" out wide on either side are all on the line, the only eligible receivers of that bunch would be the last receiver on both sides. The 2 upbacks "flanking the snapper" are eligible (numbers permitting) since they are off the line, so they may proceed downfield on a pass. The 4 interior receivers of the 6 total trips receivers on either side are ineligible receivers because they are "covered" by the outside receiver.
The simple explanation for this is if you are on the line and there is a player on the line outside of you, you are covered and ineligible. If those 4 interior trips receivers (who were all on the line) went downfield after being covered by the 2 last receivers on the line, and a forward pass beyond the LOS was attempted, you have a penalty. The key is to make sure that a pass beyond the LOS was actually attempted. If the punter just tucked the ball and ran, it's a legal play. If the punter threw a forward pass that didn't go beyond the LOS, it's a legal play. It sounds more like this was a miscommunication by the punting team, as in some receivers did not realize it was a fake punt and proceeded downfield as they would on a punt.
