Well based upon THAT criteria, they made a really bad call.
A player must make a football move before the reception is complete in a situation like that. Apparently, the rule book does not consider stumbling to the ground to be "football move".
From what I gathered from the explanation, the player must have both knees off of the ground in order to make a football move. In this case, the ball was out before both knees were off of the ground.