A threesome of only men.
It is referred to as A Jester's Hat due to the three long cone's that hang off of the hat, this imagery relates to the three penises involved in the act.
Dan: How so?
Nate: I walked into a room and there was A Jester's Hat!
Dan: Holy shitting thundercunt, that's crazy.
The person in the middle of the circle then proceeds with oral sex on the penises, especially wanking/jerking off 2 penises at a time to emulate the shape of a Jester's hat on his or her head.
Note: Each penis refers to one of the floppy points on a jesters hat (liliripes). A minimum of 3 is required.
"sup girl. how do you feel about wearing a jester's hat for me and the boys tonight?"