https://www.gamespot.com/articles/star-wars-knights-of-the-old-republic-remake-is-no-longer-in-development-report/1100-6519286/
The report comes after Sony recently removed the game's announcement trailer from YouTube and social media.
Group announces fan remake. Group get cease and desist. Internet tells them they should have just dropped it one day out of the blue. A tale as old as time. Im sympathetic. But its idiotic to announce a fan remake of anything unless you have the written consent of the owners. (and even then its risky because they can always revoke those permissions at random)
The announcements of fan works are always to drum up more fans to contribute to the work. And honestly 99/100 it doesn't result in legal threats, it makes sense to do. Fan works don't get made in secret, in secret they get to version 0.01 and sit on one person's hard drive for a decade
According to Wikipedia it started out as a mod, Valve asked them not to give it a name too similar to their own Half-Life Source, then later Valve approached them and suggested a commercial release!
In Valve’s case it’s just a smart move both for PR and business. Black Mesa isn’t competing with any of their products since I’m sure not many younger people are super interested in the original. In fact the remake might drum up interest by some people to play the original. And it’s sold on Valve’s platform, giving them a cut. Win win.