Yes, I already read the news somewhere that he is selling because of some conflict of interest. I think this will be a huge blow to the coins that he has created. Although he said that the didn't owned that much, still there's a significant impact on the price. The price just plummeted together with most of the altcoins.
On reading the headline, my fear was that this was bad news for the project. But it seems that he's determined to stay involved and that this represents an ethical choice, so good luck to Charlie.
Of course this is really bad news for the project. Who will be the next face of Litecoin? The project has so much potential but if the founder himself has left because of personal reasons, then how can it survived?