Basically, when Jack O’Toole runs into Draco Malfoy (along with Crabbe and Goyle) one night in Sunnydale, this is what happens:
Jack: (to Draco) When I get my buddies together, we’re gonna kick your butt ‘till it’s a brand-new shape.
Draco: (coolly looks Jack in the eye) Ooh, not very friendly. (to Crabbe and Goyle) Boys, I think it’s time we teach Jack O’Toole here how to respect his superiors.
Jack: (now surprised as he’s realized who he’s talking to) How did you know my name? And what did you mean when you said.. (suddenly realizes what Draco means when he notices the meaningful sneer on Draco’s face) I hope you don’t mean ‘yourself’.
Draco: (narrows his eyes as he looks at Jack) How dare you talk like that to me! Filthy little Mudblood.
Jack: What did you call me just now?
Draco: (takes the initiative and pushes Jack onto the ground instead of pulling out his wand) I called you a ‘Mudblood’. It means ‘dirty blood’, and it’s a foul name for someone who’s Muggle-born.. someone with non-magic parents.. someone like you. (Jack is too shocked to get back on his feet, or even come up with a good reply to what Draco has told him, while Draco himself just sneers at Jack) At least I noticed you were there, of course.