When a user opens Outlook 2007 and tries to expand a folder, they get the error message "Cannot expand the folder". The user does not have shared mailboxes or PST files, and recreating the Outl0ok profile does not resolve the issue. The same issue is not seen on Outlook 2010. Hotfix MSKB983316 does not resolve the issue.

The user has over 500 folders in their mailbox. This can be checked from the Exchange Management Shell with the following command:

(Get-MailboxFolderStatistics username).count

The maximum number of folders may have been increased on the Exchange Server by editing the following registry key.

[HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\services\MSExchangeIS\ParametersSystem\MaxObjsPerMapiSession]
"objtFolder"=dword:000002ee

Either reduce the number of folders in the users mailbox below 500, or upgrade the user to Outlook 2010.

Your Exchange Server 2003 computer may stop responding after a MAPI client opens more than the default value of certain server objects
http://support.microsoft.com/kb/830829

An Exchange 2007 Server Stops Responding to a MAPI Client
http://technet.microsoft.com/en-us/library/bb676486.aspx

A user mailbox has hit session limits
http://technet.microsoft.com/en-us/library/ff360476.aspx

Description of the Office Outlook 2007 hotfix package (Outlook-x-none.msp): June 29, 2010
http://support.microsoft.com/kb/983316
"Consider the following scenario:
In Office Outlook 2007, you have a root folder that contains more than 500 subfolders.
- Each subfolder has at least one subfolder.
- Your profile is in Online mode.
- You expand the root folder.
In this scenario, you receive the following error message when you select a subfolder:
Cannot display the folder. Your server administrator has limited the number of items you can open simultaneously. Try closing message you have opened or removing attachments and images from unsent messages you are composing
Additionally, event 9646 is logged on the Exchange server."