An unfriendly altercation in the Bay Area. Funk means a problem is going to occur momentarily because two opposing groups have just arrived at the same location. In Hawaii they call it beef. In the Bay Area, it's funk.
"There's about to be some funk up in here bro. Some drunk ass fools just walked in talkin' all kinds trash about Jr."
"I hope I don't see JR this time. I've got mad funk with that fool."