Should nested case statements within command substitutions work on in bash 3.2.x?

[Jon Seymour]

I was surprised that this didn't work with the OSX version of bash 3.2:

     /bin/bash -c 'echo $(case "yes" in yes) echo yes; ;; no) echo no; ;; esac)'

/bin/bash: -c: line 0: syntax error near unexpected token `;;'
/bin/bash: -c: line 0: `echo $(case "yes" in yes) echo yes; ;; no)
echo no; ;; esac)'

It does work with bash 4.x.

Is this a known issue with 3.2 or is it particular to the OSX
implementation (which in my case is 3.2.53(1))?

jon.