If you have any log file with \u in it configured in ar.cfg/ar.conf you will 
see this error. I have seen this problem in past and reported to BMC 
engineering.

-----Original Message-----
From: Action Request System discussion list(ARSList) 
[mailto:arslist@ARSLIST.ORG] On Behalf Of Mike Steiner
Sent: Thursday, October 10, 2013 8:53 PM
To: arslist@ARSLIST.ORG
Subject: Re: Error on startup: Malformed \uxxxx encoding

I'm on a Windows 2012 server.
Yes even though SQL Logging is turned off it was still causing the issue. Seems 
odd but it worked for me.

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