Contacted Microsoft Technical Support team. They mentioned it could be caused by these settings for SMB. We modified these settings and will keep an out during the next update.
http://technet.microsoft.com/en-us/library/ff686200(v=WS.10).aspx
The settings from the above link did not work.
More details that helped us to figure out the issue: Client Computer is a Windows Terminal Server
This knowledge base article gives more information in this regard:
https://support.microsoft.com/kb/2536487
Applications may crash or become unresponsive if another user logs off Remote Desktop session in Windows Server 2008 or Windows Server 2008 R2
Symptoms:
When running an application from a mapped drive, the application may become unresponsive or crash for a user (or multiple users) when another user logs off. For example:
- One server is a file server and another is a Remote Session Host server (terminal server).
- A folder on the file server is mapped for use by remote users connecting to the RDS server.
- An application on the mapped share is launched by multiple users.
- One user logs off, and this causes the other users of the application to experience an application crash or unresponsiveness.
Specifically, the behavior is caused when either the first user or the last user of the application logs off, depending on version. Windows Server 2008 will experience this issue when the first user logs off; Windows Server 2008 R2 will experience this issue when the last user logs off.
Cause:
This occurs due to the way in which the redirector handles the FCB (File Control Block) for the binary in question. In Windows Server 2008, the FCB is owned by the user who first opened the file and this FCB is used by subsequent users. When the first user logs off, the FCB is orphaned which caused the subsequent users of the application to crash or become unresponsive. In Windows Server 2008 R2, the FCB is owned by the last user to open the file and prior users experience the issue if the last user logs off
Workaround :
Install the application locally on terminal server instead of on a network share