When the clutch rides inside the teeth it wears small grooves in them over time. Here's an example from a clutch I pulled:
When the grooves get deep/bad enough, the teeth will break off. But whenever one goes it usually gets jammed in gears, and causes the bike to luck up, not to mention the clutch has like a loose feel. If you didnt notice, and kept going then they would break off one by one, but IF you had 2 teeth floating around isnide the clutch cover, I would think that would be enough to really foul up something. Ive seen 2 go, never all of them though.
The clutch above is still fine to run, but if the grooves get really deep, then you shouldnt re-use the basket. A clutch thats out of adjustment will accelerate the wear on the basket too.
The only explanation I could think of for this to happen would be that the dude saw a tooth fall off, removed the tooth, but kept reusing a basket that was missing teeth until 1 by 1 they all went. But youd have to be pretty fucking dumb to reuse a part that is obviously bad.