AdWeek reports that Agency.com removed themselves from the Subway pitch, supposedly because they "reached the finals of a pitch for a conflicting account."
A likely story. I note they didn't make a video to commemorate that event. And wouldn't it be ironic if it's the Arby's account they're pitching? (ref. Coudal Partners)
Even if they were able to remain in the running, I think there was too much controversy over the video, which could have resulted in doubts over their ability to handle the account. But they did manage to kick-start a discussion around viral marketing and the associated discussion around social media.