Thanks for reporting the problem. This is a bug in grep's man page, which wasn't updated back in 2016 when I updated the main documentation. (The man page is lower priority and is sometimes neglected.) I installed the attached patch to fix it.
>From f3b521b87d178205811a22aff2974d77f1aa3054 Mon Sep 17 00:00:00 2001
From: Paul Eggert <egg...@cs.ucla.edu>
Date: Sun, 20 Jan 2019 19:38:32 -0800
Subject: [PATCH] doc: --binary-files update in man page

* doc/grep.in.1: Adjust --binary-files description to match that
in doc/grep.texi.  When I updated the documentation in
2016-09-09T01:33:14!egg...@cs.ucla.edu I forgot to update the man
page accordingly (Bug#33898).
---
 doc/grep.in.1 | 13 ++++++++-----
 1 file changed, 8 insertions(+), 5 deletions(-)

diff --git a/doc/grep.in.1 b/doc/grep.in.1
index 9d0d494..dd25589 100644
--- a/doc/grep.in.1
+++ b/doc/grep.in.1
@@ -505,11 +505,14 @@ By default,
 .I TYPE
 is
 .BR binary ,
-and when
+and
+.B grep
+suppresses output after null input binary data is discovered,
+and suppresses output lines that contain improperly encoded data.
+When some output is suppressed,
 .B grep
-discovers that a file is binary it suppresses any further output, and
-instead outputs either a one-line message saying that a binary file
-matches, or no message if there is no match.
+follows any output
+with a one-line message saying that a binary file matches.
 .IP
 If
 .I TYPE
@@ -517,7 +520,7 @@ is
 .BR without\-match ,
 when
 .B grep
-discovers that a file is binary it assumes that the rest of the file
+discovers null input binary data it assumes that the rest of the file
 does not match; this is equivalent to the
 .B \-I
 option.
-- 
2.17.1

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