Seems like it. Pretty messy too because it sometimes pushes you to reset your password which then doesn't work so there are going to be a LOT of reset email codes floating out there.
Triggering millions of people to unnecessarily reset their password yet still be unable to login is not a great UX. This seems like one of those cases that's high impact when it does happen, never likely to occur on any given day, but likely to happen at some point; probably just wasn't much focus put on handling a case like this.
Sure you can set up a UX to show that the auth server is somehow down and discourage users from trying to login/reset passwords, but when shit hits the fan, you actually never know the precise error that gets thrown to the client because it could be any layer between the backend and the client that failed...