VSS_E_BAD_STATE

The various suggestions on the site have been tried.
The local "C" drive can be imaged to the external drive okay.
The local "E" drive shows the error "Result Code: 0x8004230f.

ERROR: COM call "m_pVssObject->BackupComplete(&pAsync)" failed.
- Returned HRESULT = 0x80042301
- Error text: VSS_E_BAD_STATE

(Gathering writer metadata...)
(Waiting for the asynchronous operation to finish...)
Initialize writer metadata ...
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get file list descriptors
- Get database descriptors
- Get log descriptors
- Get exclude files
- Enumerate components
- Get exclude files
- Enumerate components
Discover directly excluded components ...
- Excluding writer '' since it has no selected components for restore.
- Excluding writer '' since it has no selected components for restore.
- Excluding writer 'Shadow Copy Optimization Writer' since it has no selected components for restore.
- Excluding writer 'BITS Writer' since it has no selected components for restore.
Discover components that reside outside the shadow set ...
- Component '\TasksStore' from writer 'Task Scheduler Writer' is excluded from backup (it requires C:\ in the shadow set)
- Component '\WriterMetadataStore' from writer 'VSS Metadata Store Writer' is excluded from backup (it requires C:\ in the shadow set)
- Component '\PerformanceCounters' from writer 'Performance Counters Writer' is excluded from backup (it requires C:\ in the shadow set)
- Component '\Registry' from writer 'Registry Writer' is excluded from backup (it requires C:\ in the shadow set)
- Component '\WMI' from writer 'WMI Writer' is excluded from backup (it requires C:\ in the shadow set)
- Component '\COM+ REGDB' from writer 'COM+ REGDB Writer' is excluded from backup (it requires C:\ in the shadow set)
Discover all excluded components ...
Discover excluded writers ...
- The writer 'Task Scheduler Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
- The writer 'VSS Metadata Store Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
- The writer 'Performance Counters Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
- The writer 'Registry Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
- The writer 'WMI Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
- The writer 'COM+ REGDB Writer' is now entirely excluded from the backup:
(it does not contain any components that can be potentially included in the backup)
Discover explicitly included components ...
Verifying explicitly specified writers/components ...
Select explicitly included components ...
Creating shadow set {84ff48c1-2206-4192-90f3-af247ba9f309} ...
- Adding volume \\?\Volume{b7eb6198-894a-49b1-9f02-4e3ab2e14354}\ [E:\] to the shadow set...
Preparing for backup ...
(Waiting for the asynchronous operation to finish...)
(Waiting for the asynchronous operation to finish...)
Creating the shadow (DoSnapshotSet) ...
(Waiting for the asynchronous operation to finish...)
Error during the last asynchronous operation.
- Returned HRESULT = 0x8004230f
- Error text: VSS_E_UNEXPECTED_PROVIDER_ERROR
- Please re-run VSHADOW.EXE with the /tracing option to get more details
Completing the backup (BackupComplete) ...

ERROR: COM call "m_pVssObject->BackupComplete(&pAsync)" failed.
- Returned HRESULT = 0x80042301
- Error text: VSS_E_BAD_STATE

Windows Events
*****************************
Date 18/07/2013 04:25:28 PM
Type Error
Event 12293
Source VSS

Volume Shadow Copy Service error: Error calling a routine on a Shadow Copy Provider {b5946137-7b9f-4925-af80-51abd60b20d5}. Routine details EndPrepareSnapshots({84ff48c1-2206-4192-90f3-af247ba9f309}) [hr = 0x80042302, A Volume Shadow Copy Service component encountered an unexpected error.
Check the Application event log for more information.
].

Operation:
Executing Asynchronous Operation

Context:
Current State: DoSnapshotSet

*****************************
Date 18/07/2013 04:25:28 PM
Type Error
Event 8193
Source VSS

Volume Shadow Copy Service error: Unexpected error calling routine Cannot find anymore diff area candidates for volume \\?\Volume{b7eb6198-894a-49b1-9f02-4e3ab2e14354}\ [0]. hr = 0x8000ffff, Catastrophic failure
.

Operation:
Automatically choosing a diff-area volume
Processing EndPrepareSnapshots

Context:
Volume Name: \\?\Volume{b7eb6198-894a-49b1-9f02-4e3ab2e14354} Execution Context: System Provider