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First, internet poker is not illegal on the federal level (though one state I know of, WA, has criminalized it). What's illegal under the Unlawful Internet Gambling Enforcement Act is transferring money to and from banks and other federally regulated financial institution to a website that offers illegal gambling under the previous Wire Act that dealt with sports betting. Pokerstars and Full Tilt were closed down by the feds for setting up intermediary companies to get around the law. They actually had a pretty good case that since they weren't involved in sports betting, they weren't illegal under the wire act, and therefore weren't violating UIGEA. During the course of the investigation Full Tilt’s management was found to have engaged in fraud by using player funds to pay themselves bonuses. Pokerstars reached an agreement to not allow US customers in exchange for charges being dropped, in hopes that if UIGEA is repealed they could reenter the market. UIGEA also allows for states to authorize online poker sites for residents within their states. Apparently pooling into common games is OK as long as players enter through their own state's site. A lot of smaller online poker sites pool into common games, so that's not new.