I don't have a clue about HR at Facebook, but this sounds like someone who was never seriously considered, and only kept "in the running" because he was submitt

I don't have a clue about HR at Facebook, but this sounds like someone who was never seriously considered, and only kept "in the running" because he was submitted by an internal candidate. Especially if he was explicitly told that they were doing due diligence on OTHER candidates. To me, that is very clearly a message of, "You are good enough to hire, but only if our first 10 choices decline the job." But there is a lesson to be learned here -- don't start scaling back your personal work/projects just because a potential job would be a conflict of interest.