Yeah, that's the explanation I've heard. "We don't feel you're a good fit at this time" says nothing beyond 'no', and so there is nothing for a particularly litigious candidate to use against the company. A more verbose explanation, which would be appreciated by a majority of candidates, might accidentally give them fodder for a lawsuit.
I'm actually curious how useful it would be though. I can only think of a couple of times I've interviewed, and been genuinely curious why the company decided not to continue with me. Most times it's been "-Wow-, that was a poor fit", either culturally, or what they expected me to know, or how the position was sold to me, or whatever (my favorite being an interview with Microsoft, where the HR rep scheduling it said coding in Java would be fine, but then the interviewer was predominantly a C guy, and so was telling me that my for(int i=0; i<stringObj.length; i++) meant I was running in O(n^2) time, and my having to correct him...yeah), and only one or two times left me curious what their impressions were.
A litigous candidate would litigate based on the interview experience, not the rejection letter, and then access to internal notes (where the illegal discrimination happens) during legal discovery. The rejection letter is irrelevant. I cases that win, do you think the HR rep said "sorry blackie, we don't want your kind here"?
Which seems more damaging in an [unlawful discrimination](http://www.eeoc.gov/) case:
“Thank you for coming to interview with us. Unfortunately we decided to hire another candidate.”
or
“You had trouble connecting with the interviewer. We call that “culture fit” and value it tremendously. We encourage you to practice your interviewing skills, so you can fully take advantage of your superior technical abilities.”
The discrimination fear is a boogeyman. The example you gave isn't risky at all. The risk is that one time someone will actually leak a illegal behavior.
