...to form 2K Marin? Rumor, yes, but a rumor reported by Wired magazine.
If you follow the links (I won't quote the dirty laundry here) 2K Boston decided working for Levine wasn't their cup of tea, and most of them moved to California to form 2K Marin and make Bioshock 2. Levine is working on Project X, an X-Com sequel.
Whatever the truth is here, my sympathies are with both sides. It's tough work making a masterpiece.