[Rhino Import]-[Rhino Blocks]-Block is not assigned to any nested layer after reimporting

• Click Import CAD to load the attached Rhino file [Link Removed]
• Go to the Layers tab
• Hide Layer10
• Hide all layers

Result:
The green box (Rhino Block) doesn't get hidden by turning off layers (nested layers) although all the Rhino layers are present in the Layers tab

Expected
The green box is assigned to Layer 10

Note:
Reproduced in Release-4.20 4311715. Build c.l: 4308681 was fine.