What are you thinking is wrong with the rule? What it is basically saying is to check if the line item that you are doing the finditem() on is blank or not. If it is blank, then don't do the finditem() at all because in doing a finditem() on a blank line item will always return a blank. So essentially, this is saving the system from reading a list to find nothing. Does that help?
AHHHH....I see and you are correct, I forgot the NOT in ISNOTBlank() or I could turn the formula around and put the finditem() for the ELSE condition. Great catch, will update that now.