Although details are still appearing, Sophos is reporting that a particular combination of circumstances can result in FileVault passwords being exposed in plain-text log files. The combination is somewhat unlikely — the Mac had to be using FileVault 1 under Mac OS X 10.6 Snow Leopard, be upgraded to 10.7 Lion, and then updated to 10.7.3, all without switching to FileVault 2. Nevertheless, if this applies to you, change that password!
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Written by
Jeff Carlson
FileVault Passwords Potentially Logged in Plain Text
And here's a more-detailed article from ZDNet...
http://www.zdnet.com/blog/security/apple-security-blunder-exposes-lion-login-passwords-in-clear-text/11963
http://www.zdnet.com/blog/security/apple-security-blunder-exposes-lion-login-passwords-in-clear-text/11963