I won't reveal my identity but the issue came from Gen 6 Sprites. There's a forum post about it. Nintendo gave several cease and desists after ripped models were used. No one listened and so Nintendo now is suing for use of intellectual property rights. Zarel's in some serious shit, desu.

Servers are shut down indefinitely or until the Courts decide the fate if Zarel even fights it. Smogon might be forced to close down too but that's a gray matter.