Yes, I have had this happen a few times. Foul ball, ball is picked up and the throw back to the pitcher is tossed into the outfield. Coaches start screaming, runners start running, fielders start chasing after the ball, and I just stand there and watch until it's all over, reset everything, and call for the next pitch.
I do like your description much better and can just picture it happening on the field.
BTW, how does a ball get "gang retrieved"?