Yes, kang means third party modifications. The CyanogenMod team requests that unofficial ports and modifications are labeled this way.
Their perspective is that third-party ROMs should be marked clearly so that users don't first "blame" the core CyanogenMod project for problems in ROMs they're not responsible for. CyanogenMod allows us to use the name "CyanogenMod" under these terms.
Additionally, XDA requires that kang's are labeled.
Kang - A term used for stealing others intellectual property and claiming it as your own. (ie. When a developer uses another developer's work, and then publishes the end product as their own.)