Since the 70's I think, they outlawed surfboards from Point Panic so that bodysurfers and a small group of paipo boarders could ride it without having to jockey with surfers.
I used to frequent Panics for years, bodyboarding there and getting into all kinds of spats with some of the bodysurfers (something I'm not proud of).
Then in 1993 (I think), they put up a new sign banning surfboards and bodyboards also. I was actually in the water bodyboarding when they erected the sign. Out of respect, that was the last time I bodyboarded the spot. I even went so far as to write an article on this in the old H3O magazine, telling bodyboarders that to earn respect you have to give it by not riding there.
Guess enforcement was a big issue. Sad because only a few guys paipo the spot and they are for the most part accepted there as part of the crew.
If you want to see what all the fighting is for, check out some pics at the bottom:
http://waimea.hawaiian.net/~sponge/photos/pivotal3.html