They called the runner out for OFFENSIVE INTERFERENCE, not out because he was tagged.
6-2-g:
A.R. 2—
If the umpire declares the batter, batter-runner or a runner out for offensive
interference, all other runners shall return to the last base that was legally attained at the time of the interference.
Third base still legally belonged to the runner who was called out for interference, therefore the following runner was only legally entitled to second.
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