As far as I know:
Every LED can be used as a sensor to.
He connected the sensor to 3 analogPins to read the voltage when another LED shine on it. (set the internal pullups correctly...)
after reading a non zero voltage (I guess) he knows the LED has seen the light ...
From the three analogVoltages he can derive what the color should be approximately.
Then he uses the analogRead pins as digitalwrites (set outputmode!!) to blink the LED.
makes sense?