Sharing with the dead is bad, they have nothing to gain.

Changelog.txt

@@ -10,6 +10,7 @@ Key:
 Version 1.4.05-dev
  + Added option to allow refreshing of chunks after block-breaking abilities. (Disabled by default)
  = Fixed bug where /addxp was setting instead of adding experience
+ = Fixed bug which allowed players to share experience with nearby dead players
 
 Version 1.4.04
  + Added functions to ExperienceAPI for use with offline players

src/main/java/com/gmail/nossr50/party/PartyManager.java

@@ -84,7 +84,7 @@ public final class PartyManager {
         List<Player> nearMembers = new ArrayList<Player>();
         if (party != null) {
             for (Player member : party.getOnlineMembers()) {
-                if (!player.getName().equalsIgnoreCase(member.getName()) && Misc.isNear(player.getLocation(), member.getLocation(), range)) {
+                if (!player.getName().equalsIgnoreCase(member.getName()) && !member.isDead() && Misc.isNear(player.getLocation(), member.getLocation(), range)) {
                     nearMembers.add(member);
                 }
             }