I typed /say @e in a world with quite a lot of entities loaded, but not created by any out-of-the-ordinary means - this was just flying around the spawn area testing how well the latest build works.

The next thing that happens is that my client gets kicked.
The client's error message is a bunch of nonsense.

The server console's error message:
io.netty.handler.codec.EncoderException: String too big (was 54305 bytes encoded, max 32767)

So something along the line from the @e selector to the network packet is not trimming the string to its maximum length when it should be.

Suggested fix: trim the start of the string, so it ends up sending the LAST 32767 bytes of the string, since the client's chat history won't show the start anyway. I believe this is the way that vanilla would handle the problem.