Google Panda, I believe, is the project name for a change in the Google algorithm that produces the search results you see when doing a Google search. You keep hearing about it because it has been quite controversial.
Under the new algorithm, many previously high ranking sites took huge hits and fell very far in the search rankings. This can result in a huge loss of traffic to the site if that is how a site gets most its traffic. Some sites have seen a drop in traffic as high as 95%. Research shows that HubPages may have lost as much as 85% traffic since Panda went live.
It is controversial not only because of this but also because one of the companies hardest hit happens to be invovled in a law suit in the European Union against Google. Naturally, they and many others are crying foul! Hope this helsp.