Generating new properties file (Server)

First of all I would like to say that I looked and didn't see anyone else post a glitch like this. Also I recorded it since the server didn't generate any logs or anything. (Also I set this to Private because I don't know what kind of information the server shows)

Basically what is happening is that when I run a 1.7.1 server .jar it just spams the log with some sort of error or it says it generating new properties file.

Video: http://www.youtube.com/watch?v=-RvmDGxu9ts