FreeCS is a free chatserver (WebChat) written in Java. But even better: It is OpenSource.

(No java-applets are needed, making it compatible with every client, which is able to to show HTML-Files)

• Found a bug?
  - report it here
   
• Want support?
  - go here
   
• Want to stay up-to-date?
  - mailinglists are here
   
• Want to see it in action?
  - a demo is here
   

Only to mention some:

• Fully customizable layout (including the messages sent by users and the server)
• Authentication by modul (SQL-authentication or no-authentication implemented)
• Authorization-framework (Who may use which command)
• Networking is done with the new none-blocking-IO-Classes of Java

This is simple: Serve for as many users as possible in an as flexible way as possible :)