Didn't he do the right thing?
I don't see why we're hanging the FO. He wakes up and sees an "airplane"heading right towards him, and out of the corner of his eye, sees that the Captain is not responding. In a fraction of a second, his mind goes through several possibilities- TCAS failure being one of them.
A split second later, he reverts to basic airmanship- see and avoid. We are always very quick to pass judgment on those who are dependent on automation and rule books to fly at the expense of airmanship and common sense.
What would we be saying about him if it had indeed been an aircraft? I'd rather fly with this guy who is ready to revert to basic airmanship at a moment's notice than somebody who would just watch an airplane get closer and wonder why the TCAS hasn't said anything.