So im watching an empire (Talon) just dissolve, literally. They are losing their planets and no one is attacking them. So I flew into their main system to see what is happening. At this point on the galaxy map it showed them no longer owning anything in that system. Flew up to a few of their planets and witnessed the event. For like two seconds the planet shows under their control, and then their control disappears, and the surrounding ships take off and start flying to their at this point one remaining world. Managed to snag a picture a second after they just "lost" one of their worlds.
Three healthy ships orbiting a planet that they just lost. So whats happening here? Ive not noticed this before and I just upgraded to 1.032 shortly beforehand.