The One Where Ross And Rachel Take A Break - S3-E15
Visible crew/equipment: When Ross is on the phone to Rachel, near the start, just as he walks into the living area, a stage light is visible above him (only visible in fullscreen version). (00:06:10)
Answer: Usually by the seventh night of Hanukkah you don't know what to get the other person, and you will probably resort to getting the other person something insignificant. Chandler is basically saying that the pen is a stupid gift.