I think it's a reference to multi-player clojure REPL in Atom. I haven't looked too deeply but from what I can gather it uses Atom Teletype for the editing and they figured out how to connect to the same Clojure REPL server.
It's pretty cool and it addresses a need that we've found missing as well -- live code editing is half the feature, what's also important, is that the REPL state be synced. It's a coincidence that we both picked the same name!
Party REPL is a multi-party Clojure REPL. The authors just gave a great talk on it last week at Clojure/Conj: https://www.youtube.com/watch?v=AJING0Vigpg Even if you're not into Clojure, it has a lot on the internals of a multi-party REPL and VS Code.
In addition to sharing code and a REPL, it also allows you to collaboratively edit HTML, CSS, web pages, etc. Really cool talk!
