According to Jim Episode 2.03 The Baby Monitor

Cheryl wants to be friends with the new couple who just moved into the neighborhood. She has to be fast and do it before they talk to anyone else and get scared of them. After lending Janet the baby monitor, Cheryl schedules dinner with the new couple and has a hard time convincing Jim to go. When they get home back from the dinner, Cheryl is thrilled that it all went very well, and they're surprised when the baby monitor picks up Ted and Janet's conversation from their bedroom. The entire family gets addicted to eavesdropping on the couple, and Jim accidentally slips Ted's nickname for his penis. The new couple is outraged, and it takes Jim to make up a story about a homosexual experience he had in college to even the score and not lose their new friends.