A hot potato represents a resource conflict, which came into existence because you forced an activity to occupy a space already occupied.
Multi Project Planner remembers the conflict, i.e. it has the hot potato.
The following video illustrates "Hot Potatoes".
The hot potato in the Carpenter/Team 2-row has to be finished in week 16, so we'll force it down upon the existing activity.
Multi Project Planner will push the existing activity to the right (in this case), and if no space for it there, turn it into a hot potato.
This may ripple on until:See Using Template Projects for an example of how hot potatoes come into existence in the first place.