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While this was still the model, two employees who worked in customer service answering phones were designing their own Magic set.

This wasn't uncommon. Several early sets that never saw the light of day but were designed by employees of WotC for various reasons. A set named Power Lunch was apparently full of broken cards that entirely existed to power game and make over the top games. Vortex of Chaos was playtested, but was left to the wayside when the block format was formalized.

Adirkson liked the two employees designs, and gave them the green light to make the set. The East Coast design team (The Team that designed Fallen Empires) was angry they were snubbed from designing another set, and while I don't know all the details, there was a great deal of backroom politics because of this.

In other words, Homelands was sabotaged