1. When capital letters are used in sentences randomly, accidentally, or in places that are unnecessary, in a way which is annoying.
2. When someone is typing with the caps lock on without noticing, demonstrating extreme noobishness.
Guy: hEY EVERYONE. jUST GOT THROWN OUT OF mED CUZ i KILLED A CHIHUAHUA.
Grammer Nazi: Dude, derpcaps!