The Hollywood Reporter offers a detailed look at how this controversy arose in the first place, beginning with the fact that Fox, following the release of X2, had made the decision to come up with films focusing on individual characters — this despite the fact that a third X-Men film was planned.
"So in 2004, David Benioff was hired to pen a Wolverine spinoff, and Turner was hired to write a Magneto spinoff," says the article. "Over the next four years, those two scripts were developed and eventually re-branded as X-Men Origins: Wolverine and X-Men Origins: Magneto. David Goyer came on to direct Magneto in April 2007 and also worked a bit on Turner's script, which took a look at Magneto's origins as a Holocaust survivor and his early friendship with Professor Charles Xavier. Even though it was ready to cast and go forward, Fox kept waiting to get X-Men Origins: Wolverine in shape enough to entice Hugh Jackman back to the franchise, since his character was a more bankable hero than Magneto's revenge-minded evil mutant."
There was a time when the studio considered creating a hydbrid screenplay utilizing both Origins stories, but ultimately Wolverine starred in his own adventure while the Magneto project was put on hold. Then Schwartz was hired in November of 2008 to write a screenplay with the idea of a "First Class," which, the following year, led Bryan Singer to state that he would be directing the film. He followed up with his own treatment, that was expanded into a screenplay by Moss, after which Miller and Stentz were hired for rewrites. Singer ultimately took the role of producer, making way for Matthew Vaughn who, in turn, brought along his collaborator, Jane Goldman.
There's more to the story, which you can get by following the link.