Have seen this before and did the following:

1. Ran Clean local user cache ( procedure below)
2. Ran Repair command line repair( http://eyeontesting.com/questions/3311/repair-uft-115-from-command-line.html#answer-3312)

Issue now resolved and customer request to close case.

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Clean QTP local users settings and cache
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Problem: There are times when the local user and temporary directory files have a problem and they need resetting to resolve the issues.

Solution: Below process will reset all setting for the current user of UFT. This will not remove UFT from a machine. The batch file will back up the UFT registry setting for the local user in a directory created in the procedure below. Note some of the custom setting for user preference will be lost during running of this command file.

Download the file (DO NOT RUN DIRECTLY FROM BROWSER) from http://www.ftporasi.com/HP%20Utilities/ClearQTPUser.cmd

1. Download file.
2. Ensure user has local admin rights before running batch file.
3. Create a directory to place this file in like C:QTPClearUser
4. Stop UFT if running.
5. Open Dos Prompt and go to directory created above. NOTE: If you are running this in Win7/Win2008/vista environment ensure DOS Prompt is run as Administrator.
6. Run the file batch file.
7. Recommend rebooting
8. Start UFT to see if issue has been resolved.