I don't know either Steve, Mark or you, of course - but this sounds like a broken dynamic where boss's preference of one person (sitting next to Mark, probably

I don't know either Steve, Mark or you, of course - but this sounds like a broken dynamic where boss's preference of one person (sitting next to Mark, probably mentoring him) pushes another, Steve, to show his fighting side. Yes, Steve should have kept things honest. But being the boss, you need to be careful not to pick favorites and to treat everybody in a similar fashion. People are very touchy about how they are treated within the "tribe". Also, if you identified the issues both of them are bad at, are you all solving them? Being "terrible at merges"... how does that even work? Isn't that kind of an important skill? As their boss, their know-how is your responsability too, are you solving it? Sorry if I have misjudged the situation, I obviously don't know it first-hand, so you will need to see for yourself if the above is true. There were just too many red flags (for me) in your comment to let it pass... And the reason I see them is that I have misjudged colleagues in the past, and wish I had known better then. Ah well.