I'm breaking reply into two segments due to a 40 KB limit on the phenixBB.
1 of 2) I've now changed the file labelit/interface.py so it no longer checks mosflm versions higher than 7.1.0, rather it just assumes everything will work. You were probably using ipmosflm 7.1.3 so that's OK.
This change will go into the next nightly build of PHENIX. I do not know when SBGRID will roll out the latest bleeding edge, so if you or the sysadm would like like to patch the old code I'm attaching the needed file here.