I grabbed my copy of "Golf Etiquette" by Barbara Puett & Jim Apfelbaum off the shelf to see what they have to say on the matter:
"Golfers should not stand directly behind one another, expecially on the green. This is common enough in team events, but normally it's considered a distraction and a breach of etiquette. Standing in front of someone putting, directly on the other side of the hole, is equally egregious. There will be times when it is advantageous to closely observe the roll of a putt on a similar line, a preview of your own. To do so, stand to the side out of the golfer's peripheral vision. Wait until the ball has been stroked, then and only then ease over to watch what happens. You're fine - as long as you wait until the ball leaves the putter before sliding behind to take a look."
Despite the disagreement between some posters above, I think we can all probably agree you should never do this BETWEEN the putter and the hole. If that's what happened, as I read it above, then that is a bit much by any reasonable standard.