I would consider that to be a misinterpretation. The whole project did not fall apart because Hector Martin left. But as with any project where the leaders depart, it definitely got slower.

The argument was originally about merging some Rust code into some parts of the Linux kernel if I remember correctly. It did not involve Linus Torvalds directly. Rather, the respective maintainers of those specific parts were unwilling to merge some Rust code, mostly because they did not know Rust well and they did not want to acquire the responsibility to maintain such code.