This error is caused by the Outlook 2007 Cached Exchange mode setting “Download shared folders (excludes mail folders) being enabled by default. You can untick this box manually on each client (Tools > Account Settings > Change > More Settings > Advanced) or you can disable this setting domain wide via the Outlk12.adm Group Policy admin feature set.

Microsoft’s step-by-step instructions can be found here - http://technet.microsoft.com/en-us/library/cc179175.aspx#BKMK_ConfigureUsingGroupPolicy

Basically, you need to DISABLE the “Synchronizing data in shared folders” option and apply the GPO to the users in your domain.