When migrating a mailbox using On Demand Migration, the migration fails with an error similar to:
The proxy address is already being used by the proxy addresses or LegacyExchangeDN of another object. Please choose another proxy address.
Microsoft 365 requires all proxy addresses, including x500 (LegacyExchangeDN) addresses, to be unique within a tenant.
During mailbox migration, On Demand Migration can synchronize x500 addresses from the source mailbox to the target mailbox. If the same x500 address already exists on another object in the target tenant (such as a mailbox, mail contact, guest user, or soft-deleted object), Microsoft 365 rejects the update and the migration fails.
Option 1: Remove the duplicate X500 address
Option 2: Disable x500 Address Synchronization.
If preservation of x500 addresses is not required, create a new task without the "Synchronize x500 addresses" option selected.