The 2nd season was already in production when the allegations/proof came out, and I guess Netflix did not want to just burn all that money for nothing. But they did cancel the 3rd season
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Cake day: July 9th, 2024
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From what I’ve read, they did cancel the 3rd season - maybe not directly because of what Gaiman did, but for sure because it’s not very cash money to do productions with him right now