City of Johnston Sues Ignit Over Failed $63M Sports Complex

The City of Johnston, Iowa, is suing Ignit Johnston LLC for more than $3.6 million in a breach of contract case filed in Polk County District Court, after the developers behind the proposed $63 million youth sports complex missed every pre-construction milestone, defaulted on their development agreement, and refused to repay the public incentives they had already received. The Johnston Ignit sports complex lawsuit, filed March 13, 2026, is now paired with a counterclaim from the developers seeking over $142 million from the city.¹²

What the Development Agreement Required

The project was planned as a roughly 200,000-square-foot indoor sports and recreation facility on more than 30 acres on the west side of Merle Hay Road, north of Interstate 80/35 in Johnston. The City of Johnston entered into a development agreement with Ignit Johnston LLC, formed by brothers Chad and Brian O’Meara, and put real public money behind it: $3,527,361 in pre-development grants and financial assistance, up to $14.2 million in pledged tax increment financing contingent on completion, and $360,000 per year for five years after opening to guarantee public access to courts and fitness studios.³

In exchange, the developers had to hit a series of pre-construction milestones: secure financing, deliver finalized plans and cost estimates, close on a construction loan, order steel, transfer certain property to the city, and begin construction by a set deadline. As of April 2025, the agreement gave the developer two years to complete the project. If construction wasn’t finished in that window, Ignit had to repay the $3.5 million in grants plus up to $300,000 in legal, engineering, and other city costs.⁴

How the Project Went Into Default

The developers never broke ground. The city says Ignit failed to meet any of its pre-construction obligations, and in December 2025 Johnston formally declared the project in default.¹

Under the agreement’s default provisions, Ignit had two choices: transfer the development property to the city or repay all incentives and project costs. The city set a February 1, 2026, deadline for the developers to facilitate the sale of the property back to Johnston for roughly $1.4 million. Ignit did neither. After the deadline passed, the city demanded full repayment of the pre-development grants and professional fees within 30 days, and issued a final notice of failure to reimburse on March 4, 2026.⁵

What the City Is Asking For

On March 2, 2026, the Johnston City Council voted unanimously to sue.⁶¹⁴

Ignit’s $142 Million Counterclaim

On May 30, 2026, Ignit Johnston LLC filed counterclaims against the city seeking damages in excess of $142 million. The developer alleges breach of contract, breach of good faith and fair dealing, negligence, and unjust enrichment.²

According to the filing, the city’s conduct delayed the project for years and pushed development into a period of tight capital markets and high inflation. Ignit accuses city staff of saying “one thing but [doing] something completely different,” pointing to failures to timely acquire property, resistance to grant applications, problematic detention pond requirements, and the withdrawal of a financial commitment. The counterclaim also alleges the city was unjustly enriched by taking infrastructure, engineering work, and development blueprints at the developer’s expense. Ignit has requested a jury trial.²

Foreclosures and Investor Suits Around the Same Developers

The Johnston lawsuit sits inside a larger stack of litigation against Ignit and the O’Mearas. Lincoln Savings Bank, based in Waterloo, filed a foreclosure petition against Ignit Johnston LLC and Chad O’Meara on November 7, 2025, over more than $3.56 million in unpaid commercial loans tied to three Merle Hay Road properties, with interest accruing at more than $1,600 per day. That case was still ongoing as of June 2026.⁷²

Gulf Coast Realty, a Naples, Florida-based property management firm, filed its own foreclosure case alleging default on a $2 million loan dated January 2024; that case was dismissed on June 9, 2026. City State Bank filed a separate foreclosure action against Ignit Johnston LLC and Gulf Coast Realty on May 20, 2026, and that case is ongoing. Two individual investors also sued Ignit Johnston LLC in January 2026, each alleging default on a $50,000 promissory note. One of them, Tina Smothers, said her note matured in September 2025 without payment or communication from the borrower.²⁵

Separately, the O’Mearas’ Ignit Sports and Fitness facility in Grimes closed on February 10, 2026, after the landlord locked the building over unpaid rent. On March 26, 2026, landlord Prairie Business Park II, LLC sued Ignit LLC, Chad O’Meara, and Brian O’Meara in Polk County, alleging the tenants stopped paying monthly rent of about $59,500 on a 62,000-square-foot warehouse. An August 2024 amendment had added Chad and Brian O’Meara as co-tenants, making them personally and jointly liable. The landlord is seeking $2,875,535 in past and future rent through the lease’s October 2029 expiration, less a security deposit, plus property damage, attorney fees, and interest of up to 18 percent per year.⁸⁹¹⁰

No criminal charges have been filed against either brother, and both have declined to comment publicly on the lawsuits.²

Where Things Stand

As of mid-2026, the City of Johnston’s breach of contract case against Ignit is pending in Polk County District Court, with the developer’s $142 million counterclaim now part of the dispute. The Johnston project site remains undeveloped and tied up in active foreclosure proceedings by Lincoln Savings Bank and City State Bank. The Gulf Coast Realty foreclosure was dismissed in June 2026.²

1
Business Record. Johnston Files Breach of Contract Lawsuit Against Ignit
2
Des Moines Register. Ignit Johnston Lawsuit Sports Complex Counterclaim
3
Des Moines Register. Johnston Sports Complex Ignit Lenders Foreclose
4
WHO 13. Ignit Johnston Developers Sued for $3.6 Million by City of Johnston
5
Des Moines Register. Johnston Ignit Sports Complex Ultimatum
6
KCCI. Johnston Ignit Project City Council Votes Lawsuit
7
KCCI. Ignit Johnston Project Faces Foreclosure
8
WHO 13. Ignit Sports Grimes Closure
9
WHO 13. Another Multi-Million Dollar Lawsuit Targets O’Meara Brothers Over Ignit Businesses
10
WHO 13. Ignit Failure to Pay for Lease Petition