The arcing slash puts a debuff on you that kills you if you take damage after. Your tank was running from the purple circle which gave him a tick of damage. So the slash debuff killed him instantly in accordance to the tooltip.
"Arcing Slash" should not be confused with "Savage Arcing Slash." They are two different abilities. The former is just an attack that cleaves. The latter is a cleave that also knocks the tank back and applies Touch of the Masters.
I don't agree with your assessment that he took a tick of purple circle damage either. He's clearly well out of the circle when he dies. Did you get a log, Tidus? If so, we could see what really got you for sure.
Last week I fell over dead on one pull while dropping purple circles. I died to the other tank's Savage Arcing Slash. I was far away from Kephess (between 20-30m) when this happened and still died to it. The log clearly showed that I died to the other tank's slash, and that I even shielded the hit (which would be impossible if it was a purple circle fail).
It generally seems like the Breath tank can eat cleaves when within 30m of Kephess. The best way we've found to deal with the issue on 16-man is to use 3 tanks and make sure that the tank dropping the Breath is > 30m away from Kephess. With 3 tanks we can do that.
I suppose it's possible that they truly intend for the frontal range of Savage Arcing Slash to be something huge (like 20+ m), in which case it's not a bug, but then you run into issues with the game not understanding where bosses are facing (I'm looking at you, Bonethrasher). The safest way to handle it as the Breath tank is to simply not be anywhere close when the slash happens.