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Champions of Equestria

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Sorry AJ nobody ever listens to you!

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Ferrotter
The End wasn't The End - Found a new home after the great exodus of 2012

@HighRollerHydra  
They had no money to pay the panelists with. I lean more towards the “incompetent imbeciles” version of it than “they embezzled the money,” although there’s enough oddity in the events that I don’t totally discount the possibility that it was planned as a scam all along. Later on, they even had to take up a collection to pay the hotel, who were allegedly threatening to shut down the whole con, and adding charges onto everyone’s rooms to cover what the con wasn’t paying them.
Ferrotter
The End wasn't The End - Found a new home after the great exodus of 2012

@HighRollerHydra  
Essentially. They had a panel (I think it was a music concert) that some people had paid a lot of money for reserved seats at. Then the con staff didn’t pay the panelists or comp their hotel rooms as promised, so the panelists decided they were just going to leave. Rather than refund the money to their sponsor-level attendees, they offered them an extra free hour playing in “the ball pit.”
 
And if that wasn’t bad enough, said ball pit was a small inflatable kiddie pool with plastic balls in it. And apparently someone wound up peeing in it. And it got infested with body lice, and then infected everyone who used it after that. And the walls of it weren’t strong enough to stand up to adult weight, so it sadly deflated as the hour went on.
Death2
Happy Derpy! - For Patreon supporters

YOU WILL BOW TO ME.
@Background Pony #43F8  
From what I can gather, DashCon (a tumblr-based convention, I think) was going to have some sort of big, important panel, but they couldn’t get it together in time. So they panicked and just set up a small ball pit in the middle of the place.
Ferrotter
The End wasn't The End - Found a new home after the great exodus of 2012

Death of the ball pit?
 
“I have my pride! No more ball pit, I choose death.”
 
Very well, I sentence you to death…  
…by ball pit!