We can confirm the same problem and that it was fixed by downgrading the sendmail packages to 8.14.4-8+deb8u2. The problem's a bit tricky in that the log message suggests that the destination server is at fault, where it's really Sendmail trying to look up names in To: that aren't in the envelope.
sendmail.mc with most comments removed: define(`_USE_ETC_MAIL_')dnl include(`/usr/share/sendmail/cf/m4/cf.m4')dnl VERSIONID(`$Id: sendmail.mc, v 8.13.4-3 2005-06-03 16:49:22 cowboy Exp $') OSTYPE(`debian')dnl DOMAIN(`debian-mta')dnl dnl # Items controlled by /etc/mail/sendmail.conf - DO NOT TOUCH HERE undefine(`confHOST_STATUS_DIRECTORY')dnl #DAEMON_HOSTSTATS= dnl # Items controlled by /etc/mail/sendmail.conf - DO NOT TOUCH HERE FEATURE(`no_default_msa')dnl DAEMON_OPTIONS(`Family=inet, Name=MTA-v4, Port=smtp')dnl DAEMON_OPTIONS(`Family=inet, Name=MSP-v4, Port=submission')dnl define(`SMTP_MAILER_MAXRCPTS', 10) define(`confMAX_DAEMON_CHILDREN', 150)dnl define(`confPRIVACY_FLAGS',dnl `needmailhelo,needexpnhelo,needvrfyhelo,restrictqrun,restrictexpand,nobodyreturn,authwarnings')dnl KDNSTXT dns -R TXT C{BadIdentUsers}squid CacheFlowServer proxyuser define(`confBIND_OPTS', `')dnl define(`confCONNECTION_RATE_THROTTLE', `15')dnl define(`confCONNECTION_RATE_WINDOW_SIZE',`10m')dnl FEATURE(`access_db', , `skip')dnl FEATURE(`greet_pause', `1000')dnl 1 seconds FEATURE(`delay_checks', `friend', `n')dnl define(`confBAD_RCPT_THROTTLE',`3')dnl FEATURE(`conncontrol', `nodelay', `terminate')dnl FEATURE(`ratecontrol', `nodelay', `terminate')dnl define(`confMAX_MESSAGE_SIZE', 50000000) FEATURE(`blacklist_recipients')dnl FEATURE(`mailertable')dnl FEATURE(`virtusertable')dnl FEATURE(use_cw_file)dnl FEATURE(use_ct_file)dnl include(`/etc/mail/tls/starttls.m4')dnl include(`/etc/mail/sasl/sasl.m4')dnl define(`confAUTH_OPTIONS', `p,y')dnl FEATURE(`always_add_domain')dnl MASQUERADE_AS(`my-domain.example.com')dnl FEATURE(`allmasquerade')dnl FEATURE(`masquerade_envelope')dnl FEATURE(`dnsbl', `zen.spamhaus.org', `$>GetTXT $&{client_addr} $| zen.spamhaus.org $| Host $| " blocked: see " $| for details') define(`confMILTER_MACROS_ENVRCPT', `{rcpt_mailer}, {rcpt_host}, {rcpt_addr}, b') INPUT_MAIL_FILTER(`greylist',`S=local:/path/to/milter-greylist.sock', F=, T=C:6s;E:12s)dnl INPUT_MAIL_FILTER(`clmilter',`S=local:/path/to/clmilter.sock, F=, T=C:70s;E:4m')dnl INPUT_MAIL_FILTER(`spamassassin', `S=local:/path/to/spamass.sock, F=, T=C:2m;R:2m;E:8m')dnl define(`confINPUT_MAIL_FILTERS', `greylist, clmilter, spamassassin') MAILER_DEFINITIONS MAILER(`local')dnl MAILER(`smtp')dnl LOCAL_RULESETS SGetTXT R$-.$-.$-.$- $| $+ $| $+ $| $+ $| $+ $: $6 $1.$2.$3.$4 $7 $(DNSTXT $4.$3.$2.$1.$5 $) $8 SLocal_check_relay R$* $: $(dequote "" $&_ $) RIDENT:$* $: $1 R$={BadIdentUsers}@$* $#error $@ 5.7.1 $: "550 Access denied because your ident string is " $1 LOCAL_CONFIG O CipherList=ECDH+AESGCM:DH+AESGCM:ECDH+AES256:DH+AES256:ECDH+AES128:DH+AES:ECDH+3DES:DH+3DES:RSA+AESGCM:RSA+AES:RSA+3DES:HIGH:ECDHE-RSA-RC4-SHA:ECDH-RSA-RC4-SHA:ECDHE-ECDSA-RC4-SHA:RC4-SHA:!aNULL:!MD5 O ServerSSLOptions=+SSL_OP_NO_SSLv2 +SSL_OP_NO_SSLv3 +SSL_OP_CIPHER_SERVER_PREFERENCE