From Monkey Island wiki
In the "Launch of the Screaming Narwhal" the Voodoo Lady tells Guybrush to visit the Jerkbait Islands in search of La Esponja Grande. Her old lover Coronado De Cava studied there in search of the same sponge years before.
The islands are the epicentre of activity in "The Siege of Spinner Cay". Someone with a travel pass can hire a raft from a Vaycaylian employee to travel between the three islands. Later Captain McGillicutty's fleet uses Spoon Isle and Roe Island as natural barriers to more efficiently block in Spinner Cay during the episode's titular siege.
"Jerkbait" are artificial fishing lures, meant to be zig-zagged back and forth to attract fish. After Guybrush's primary adventures in the Jerkbait Islands, he and Winslow sail the Screaming Narwhal in several supposedly aimless directions before being swallowed by a giant manatee.