I heard about this exact case years ago. I still don't know what to think. At the time the story first broke, you couldn't find any news coverage of it anywhere, except for one obscure community college newspaper in Stewart's hometown. For me, this didn't suggest any lack of credibility on Stewart's part, but either a disinterest in the story, or conversely, an interest in keeping the story buried.
There were rumors that the issue was settled out of court, but I can't find any evidence on the matter.
I think this may have been a case of unintentional theft (giving Hollywood the rare benefit of the doubt) - a situation where someone read Stewart's submission, dismissed it and forgot about it, then years later had a "Eureka" moment, a great new idea about a futuristic sci-fi story. Except they forgot that it was someone else's idea.
The same thing happened with a guy in France who wrote a book called Pierrot Le Poisson Clown in 1995, only to see virtually the exact concept presented by Disney (who he had submitted the idea to) in Finding Nemo, only with some minor details switched around. The guy sued Disney and lost, and some booksellers even removed his book from their shelves for being too close a copy of Finding Nemo!
I think this kind of thing happens all the time.
I can also picture a bunch of fat and happy Hollywood execs sitting in a room, sharing a private joke about the old adage "Talent imitates, genius steals".