If merely advertising 1.3 while still advertising older versions causes blue coat to break, it has a bug in TLS version negotiation.
There is no downgrade or whitelist or failing closed. Each end says what they support and BlueCoat blows up the connection if it sees that the other end supports a newer version. It should say "oh we both support 1.2 let's use that" And apparently it's done this before so there's even less an excuse for it.
It then simply inspects a connection it doesn't understand and 'fails closed' by preventing that connection.