Originally Posted by SoK66
It's usually connected between one leg of a grouynd switch on 2-prong vintage amps, and was intended to filter out buzz or hum in the line. It can short internally, putting full voltage straight to the chassis and potentially up the cord to you. Hence the term "death cap". On a 3-prong conversion the ground switch is eliminated, as well as the death cap.
That was my best guess so thanks for clearing it up.