I'll bet he was asked to step down from his post. I think Blizzard know D3 did not receive the reception they were hoping it would receive. They would have to be tone deaf to not know. So Jay, being the project leader was asked to move on to another project. No doubt he still holds a "high" position within Blizzard.
Now, people will say that he was successful because D3 sold so many copies so quickly. But I believe it sold that many copies due to the Diablo and Blizzard names, not because it was such a great game. Time will tell. I am a bit sad he had to leave his post and I hope he can be successful elsewhere, on his next project. One can get burned out too, so if he has been living and breathing Diablo for 7 years it was probably time anyway. On the other hand, I am excited for the future. New blood may be just what we need.