Hi M. T. Dremer. In answer to your question, Valve can make a 'sequel' to DotA (or Dota as it is now being referred to because the acronym seems to have formed it's own word) because they hired the majority of the team that worked on the original DotA mod. Valve have given them funding and the guidance of a company that knows what they are doing and are letting them do their thing.
Often it is modders that are truly pioneering innovative games as large publishers tend to shy away from doing anything to original in case it affects their profits. And you will also find that many modders end up getting hired by these larger companies. For example, just look at the modder who made some brilliant mods for Civilization IV and ended up being hired by Sid Meier's company to be one of the Lead Designers for Civ V. And now a few members of the original DotA mod have been hired by Valve!
As to Blizzard having any rights to Dota 2, well, they don't. They have no rights or claims to the IDEA behind the original DotA mod. You will find multiple games that are essentialy DotA clones out already, such as League of Legends or Heroes of Newerth. I will also add that Dota 2 is being made on an entirely new game engine and all that jazz, so really Blizzard has absolutely nothing to do with it and cannot claim anything. I don't think they are too concerned though really, they own the big gorillas that are WoW and SC2, and let us not forget Diablo III on the horizon.
So this is really long... not sure how that happened! I just was reading about Dota 2 the other day hehe.