No, the alternative was to give the IP and equity ownership proportionally to the employees, not 100% to the founder.
Instead, they gave it all to the founder and none to the employees who built the IP (as far as I can tell from public documents).
Employees were told they received nothing because their work was useless. Apparently it wasn’t so useless.
At the time it was deemed worthless or whatever term we want to call it, the owners were the initial investors. They sold it (well some of them) back to the initial founder.
It's their ownership to sell....
I go back to my point that we need to be honest about what the equity and rights of individual contributors really IS more than some ephemeral expectation that someone should get equity ... after most everyone has given up... or after others work to resurrect it.
I'm not sure I understand why that would be or why that would even come up if you were investing in 'worth nothing'.