Looking at it from 2017, it doesn't seem like much but back then when violent cartoons (which are not violent by today's standards) were heavily frowned upon, so I imagine the family didn't want late Jim Henson's reputation to be ruined by having his name attached to tmnt.
Although to be fair, even if I did think violent cartoons were bad, tmnt 2 was heavily toned down from the first where it got criticism for having too much slapstick and the turtles not using their weapons.
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