Straight from Microsoft KB:This beh

Straight from Microsoft KB:

This behaviour may occur if Word determines that the owner file for the document already exists. This may occur if one or more of the following conditions are true:

Word previously quit improperly and, therefore, did not delete the owner file. -or-
A second instance of Word is running in the background with the document already open. -or-
The document is shared over a network, and another user has it open. From my personal experience, I've found a combination of the first and third point above can recreate this error quite constantly

Temp files, left next to the original file on the network (especially if the file is large, she copy-pastes a LOT or it is open all day) are the cause.

To resolve this issue, first confirm that another user on the network does not have the document open. If the document is in use, open the document as read-only. If it is not in use, quit all instances of Word, and then remove the owner file. To do so, follow these steps.

NOTE: Because there are several versions of Microsoft Windows, the following steps may be different on your computer. If they are, see your product documentation to complete these steps.

Quit all instances of Word. To do so, follow these steps: 1. Save all your work, and then quit all programs. 2. Press CTRL+ALT+DELETE to open the Windows Security dialog box. 3. Click Task Manager, and then click the Processes tab. 4. Click Winword.exe, and then click End Process. 5. In the Task Manager Warning dialog box, click Yes. If you receive a message that states that the program is not responding, click End Now. 6. Repeat steps d and e for each occurrence of Winword.exe. 7. On the File menu, click Exit Task Manager.
Start Windows Explorer, and then browse to the folder that contains the document file that you tried to open when you received the error message.

Delete the owner file.

The owner file is located in the same folder as the document that you tried to open. The owner file name uses the following convention: It begins with a tilde (~), followed by a dollar sign ($), followed by the remainder of the document file name. The file name extension is .doc. For example, the owner file for Document.doc is named ~$cument.doc.
Start Word. If Word asks you whether you want to load the changes that were made to the Global or Normal template, click No.
Open your document.