The dispute centers on a $2.1 million loan Lights Out secured in 2024. Court documents indicate missed interest payments and ARI’s claim to governance rights under the loan, including proxy and warrant provisions that could dilute Merriman’s equity. Merriman’s team contends these provisions were intended to protect collateral, not to transfer managerial authority or ownership, and they allege improper removal and changes to corporate structure.
Litigation has moved between state and federal courts as both sides seek relief. Merriman has sought a temporary restraining order and damages, arguing that ARI’s actions disrupted fights, vendor contracts, and the fighters and staff connected to Lights Out. ARI counters that it acted within its secured lender rights during a distressed loan scenario and that Lights Out remains under its control through governance mechanisms tied to the default.
A recent court decision remanded part of the case to state court, with further filings and a renewed TRO request potentially shaping the next steps. Both sides have indicated an ongoing desire to resolve the matter and resume operations, while the leadership shakeup and legal wrangling threaten to impact Lights Out’s live events, streaming plans, and partnerships. The decision on the TRO and other motions could come in the near term.
