Well that's pretty pitiful riding for two riders, clearly with a ton of room ahead and to either side manage to get tangled up in a crash. But I gotta say that was a very hard chop by the rider in blue and for no apparent reason as he had no reason to move right suddenly, he had all the road he needed to either move right on a smooth and predictable diagonal or to slide left but instead he dramatically hooks right. Sure the guy in the red striped jersey was floating in a bad place and not doing much to protect his front wheel but that was a pretty strung out field with a lot of room to move predictably and that was a totally unexpected and hard hook.
Per the current USAC rules page 47 of General Regulations (taken from UCI rules)
1N7
No rider may make an abrupt motion so as to interfere with the forward progress
of another rider, either intentionally or by accident.
Yeah, the rule is rarely enforced but abrupt motions that result in accidents like the one on video are not legal whether or not the move was intentional. The question usually boils down to interpretations of 'abrupt' but the move you caught on video was pure bush league riding.
The guy drifting back did nothing wrong, he held his line as folks came around him. Sure if he was blown off an earlier race or spit out of a break he might have been polite and drifted back on the outside but folks can blow up, shut down, flat or drift back from the center of the peloton at any time and as long as they hold their line and ride predictably they've done nothing wrong.
I'd put about 90% of the 'cause' of the crash on the bonehead in blue that made a totally unnecessary hard hook to the right when he had all the room in the world to move on a predictable diagonal in either direction and wasn't even in traffic. Sure from a self preservation standpoint the guy that went down could do a better job of protecting his front wheel but he wasn't riding crazy overlap for the situation and when things get really tight in a fast crit there's a whole lot more overlap than that happening for anyone wanting to stay forward and in contention.