See John Scalzi's "Old Man's War" for an example of a galaxy with many races and little planetary space. Civs would have rogue "wildcat" colonies from desperate or stupid groups with a race trying to colonize in locations not only in someone else's area of influence, but actually on some of their own sparsely populated planets.The official government position was that these wildcat colonists had no permission to colonize and were thus disavowed.
Suggestion for the devs.
Make new Option for "wildcat" colonies. (as always, please allow the option to be disabled/or enable per user choice)
"What do you mean Earthman, a new Deregin colony in your backyard? Oh, those guys? Huh, they aren't mine." "They sure look like Deregin." "Ah, well, see but they aren't official, just a few overeager fellows from that other political party" "So, then, you aren't officially worried about their fate?" "Meh, I never liked them anyways"
1) Let races colonize where they will
2) Note if colonization occurs in on a planet that is already within the sphere of influence, by default, note that and mark the colony as a wildcat colony
3) Do not penalize a civilization for removing wildcat colonies in its sphere of influence.
4) Do not penalize the "parent" civ if the colony can defend itself.
5) For diplomatic purposes, a wildcat colony would be treated as new minor race that a civ completely controls, but doesn't affect their diplomatic status.
4) A variation would be to allow the civ colonizing a planet in those circumstances the opportunity to "formally dispute the territorial claims" of the original owner, so as to protect it's new colony. On the next turn for the other civ, pop up a diplomacy dialogue with that information, and give the two civs a chance to negotiate over the new colony. If they come to agreement, the colony is protected. If not, they go to war over it.
It's like a nation tried to claim the planet of Crimea, wait no, bad example. Ok, like they tried to claim the colony of Golan Hei, ah no. The star system of Poland?
Ok, I give up, but you guys get the idea.