Phone Story was pulled from the iTunes App Store on Tuesday September 13 2011 at 11.35am, only a few hours after its official announcement.
Apple explained that the game is in violation of the following guidelines*:
15.2 Apps that depict violence or abuse of children will be rejected
16.1 Apps that present excessively objectionable or crude content will be rejected
21.1 Apps that include the ability to make donations to recognized charitable organizations must be free
21.2 The collection of donations must be done via a web site in Safari or an SMS
We contest the violation 21.1 and 21.2 since it's not possible to make donations through Phone Story. Molleindustria simply pledged to redirect the revenues to no-profit organizations, acting independently.
The 901 users who managed to buy the app before it went offline are now owners of a rare collector edition piece.
Phone story is now available on the Android market, on Apptrackr for jailbroken iOS devices and online. We are currently working on on a open standard compliant version in Processing.js.
We'll be posting further updates on our twitter
Contact: 
* From App Store Review Guidelines (the document is only visible to logged-in developers).