VMware Cloud Director Availability 4.7.3.x
VMware Cloud Director Availability 4.7.4
There is an existing replication tracking VM in the vApp that has a placement policy that is inconsistent with its cluster location. When the new replication is initiated, the vApp recompose event re-evaluates the existing VM placements and determines that the inconsistent item is in a location that does not accommodate the associated policy in VMware Cloud Director (VCD). The error prevents the new replication creation from being completed.
This behavior can occur if the inconsistent VM replication is created without specifying a placement policy and then the VMware Cloud Director placement policies are adjusted at a later date.
Remove the misplaced VM replication and retry creating the new replication.