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Project Shiny is a project that was built to overhaul League of Legends' graphics, improving them texture-and-model-wise to look better on faster rigs.
Lead Producer Travis 'Volibar' George claimed that Project Shiny and Dominion were originally a combined development. The hope was that these combined projects would synergize with each other and turn out to be better than expected.
However, due to Dominion's development phase, it had many iterations and many unknown variables. As Project Shiny team was working mainly on Summoner's Rift, their request of finalized data on Dominion cannot be fulfilled, which in turn, created a tension between the two teams. This had further caused a stall in Project Shiny, even after Dominion was finished.
George took it that the mismatch and goal discrepancies between the two teams cannot continue, and therefore separated Dominion and Project Shiny into two detached entities.