Apparently, someone pretended to be a girl dying of cancer. Lots of people fell for it. Eventually, someone else posted a thread on MeFi calling this person out for being a faker. (no, not a [fakir]) Eventually, it was discovered (by MeFites?) that Kaycee was fake.
It seems that this is a big part of MeFi history, as people are always making references to it. It would be cool if someone would help me out here with this, seeing as that I wasn't even a member when the whole thing went down, and am doubtless leaving out important details.
Here's the thread where Kaycee ["died"]. Here's the thread where she was ["outed"]. Here's a funny [joke page] related to the whole ordeal. Here's a Museum of Hoaxes [page] on the subject.