There are two problems with this phrase, one is that it shouldn't. Really, if somebody a bit worse goes way into the negative value for you and you are a large company, you have some procedural problem that should be fixed. Long-time employees also have bad moments, and you should be able to survive those.

The second problem is that the onus is on you on making sure those bad interviews decrease the odds if hiring bad people, instead of increasing them or being irrelevant. Without that evidence, this is a non-argument.