One of the features of Alexa is to make "phone calls" to other Alexa users in your contacts.
It looks like what happened is that while they were talking about hardwood floors or whatever, Alexa misunderstood something they said as a request to call that contact. Then the other person just heard their continuing conversation.
This gels with the Amazon Engineer said Alexa "guessed" something they said.
Basically, there's no bug, other than the standard, "sometimes Alexa doesn't understand you correctly and does something else," which is par for the course. Which is why I don't have that feature enabled, or the feature that lets you order from Amazon. Basically, I want Alexa mistakes to have trivial consequences.
It wont stop the paranoia though