I'm guessing it was because this was during the time players could ring in as soon as the clue was exposed, which often led to contestants finishing in the red at the end of Double Jeopardy!
Rick is in the biggest deficit, which means that he finishes in 3rd place. Carol is not as far in the hole as Rick is Carol is. So, she finishes in 2nd place. Mike is gonna play Final Jeopardy! all by himself.
It is believed to have happened once on the Art Fleming version. Reportedly, no Final clue was played, and the time was filled with extra contestant interviews. Sadly, we can never be sure, as 99% of the Art Fleming version was destroyed.
They said on the official website a while ago that if it ever did happen, the rules currently say that no FJ clue would be played, but speculated that if it did happen, they'd probably still show the clue for the home audience to play along with, since otherwise it'd be tough to fill the time.
Our only example is the parody Celebrity Jeopardy! skits on Saturday Night Live, with every contestant in the severe negative score. They just play it anyway, "for charity".
Don't feel bad, Loni. Because you didn't finish as far in the hole as Sean, you'll finish in 2nd place and you'll win $2,000. Sorry, Sean. You'll have to settle for $1,000.