Oh :)

Once per day a request is made all instances to retrieve the list of their admins. If that request fails then they're flagged as 'dormant'. If dormant for 5 days, flagged as 'gone forever' and then PieFed doesn't try to federate with them again and all their communities have that warning on them.

If any Activity arrives from a dormant / gone instance then it's restored to full operation.