You have probably used up all the files used for squeak. Try deleting some of your saved things and stuff. Or try deleting patches. Or downloadable content. (if there is any)
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Zelda123, I have been getting this message also at times when importing graphics, and I'm pretty sure that it did not have anything to do at all with "space being low" or too many files being open at the same time. I could not reproduce it systematically so there's no telling for me what exactly triggered the message. The next time this message pops up I'd be interested in having a look at the message stack that shows when you click on the "debug" button. Maybe this will offer some starting point ..
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Can you open the GIF in any other program / editor? Are you sure it's really a GIF and not some other file format falsely renamed to .gif? Maybe you can open it in an editor, select everything and copy it into a new GIF...
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