Actually, no it didn't. The first report on it was that it wouldn't fully engage in the Full auto position. It was only on subsequent abuse by the BATFE that they finally broke it the rest of the way and got it to go into a "wild fire" mode where the sear catch was completely broken off.
I have been following this one over on ARFCOM. The government is up to no good on this one.
See the link in #16. The genius professor told the student not to use the unmarked position 3, because it might fire off 3 rnds. The student placed the switch in the unmarked position at the range, and it did fire off 3 rnds before jamming. The ATF found that position 3 would consistently fire of 20 rnd mags at full auto.
"It was only on subsequent abuse by the BATFE that they finally broke it the rest of the way and got it to go into a "wild fire" mode where the sear catch was completely broken off. ...The government is up to no good on this one."
Yeah, sure.
"This was literally a malfunction that was then blown out of proportion by the Feds."
Not according to the discussion between Olofson and the "student" when the gun was loaned out, or according to the gun's performance at the range, or the findings from the lab.