Smartdisk commands returning Failed to execute 'C:\Program Files....' (88086)

Attempts to run many of the command line SmartDisk commands return an error. E.g.

C:\Program Files\BakBone Software\NetVault SmartDisk\foundation\bin>smartdisk stop
Failed to execute 'C:\Program Files\BakBone Software\NetVault SmartDisk/foundation/bin/servicetool --stop --wait'
 

A file in the root of the system directory (C:\ is the default) called 'program' can cause program launching to fail.

See https://support.microsoft.com/en-us/kb/195052

Removal of this file should return the system to normal.