Yes, and in the process also taking out innocent websites as well. This isn't an algorithm update against "bad" websites. It's an algorithm update that negatively affects websites that fit a certain pattern - and you can fit that pattern without even being shady.

For example, if someone doing negative SEO by blasting 10,000 bad, spammy links pointing to your website - the penguin update penalizes your site. Even if your site is about helping cancer patients, or feeding Africa.