Cannot deploy exploded .jar inside exploded .war

Hi all! I deploy my app as an exploded war there in WEB-INF/lib there is a jar deployed as exploded folder. However when the server starts I get the following exception:

17:59:15,423 ERROR [org.jboss.msc.service.fail] (MSC service thread 1-3) MSC00001: Failed to start service jboss.deployment.unit."MyApp.war".STRUCTURE: org.jboss.msc.service.StartException in service jboss.deployment.unit."MyApp.war".STRUCTURE: Failed to process phase STRUCTURE of deployment "MyApp.war"
at org.jboss.as.server.deployment.DeploymentUnitPhaseService.start(DeploymentUnitPhaseService.java:119) [jboss-as-server-7.1.1.Final.jar:7.1.1.Final]
at org.jboss.msc.service.ServiceControllerImpl$StartTask.startService(ServiceControllerImpl.java:1811) [jboss-msc-1.0.2.GA.jar:1.0.2.GA]
at org.jboss.msc.service.ServiceControllerImpl$StartTask.run(ServiceControllerImpl.java:1746) [jboss-msc-1.0.2.GA.jar:1.0.2.GA]
at java.util.concurrent.ThreadPoolExecutor$Worker.runTask(ThreadPoolExecutor.java:886) [rt.jar:1.6.0_24]
at java.util.concurrent.ThreadPoolExecutor$Worker.run(ThreadPoolExecutor.java:908) [rt.jar:1.6.0_24]
at java.lang.Thread.run(Thread.java:662) [rt.jar:1.6.0_24]
Caused by: org.jboss.as.server.deployment.DeploymentUnitProcessingException: org.jboss.as.server.deployment.DeploymentUnitProcessingException: JBAS018037: Failed to process WEB-INF/lib: "/C:/Users/amitev/Desktop/mse2012/jboss-as-7.1.1.Final/standalone/deployments/MyApp.war/WEB-INF/lib/Module1.jar"
at org.jboss.as.web.deployment.WarStructureDeploymentProcessor.deploy(WarStructureDeploymentProcessor.java:120)
at org.jboss.as.server.deployment.DeploymentUnitPhaseService.start(DeploymentUnitPhaseService.java:113) [jboss-as-server-7.1.1.Final.jar:7.1.1.Final]
... 5 more
Caused by: org.jboss.as.server.deployment.DeploymentUnitProcessingException: JBAS018037: Failed to process WEB-INF/lib: "/C:/Users/amitev/Desktop/mse2012/jboss-as-7.1.1.Final/standalone/deployments/MyApp.war/WEB-INF/lib/Module1.jar"
at org.jboss.as.web.deployment.WarStructureDeploymentProcessor.createWebInfLibResources(WarStructureDeploymentProcessor.java:175)
at org.jboss.as.web.deployment.WarStructureDeploymentProcessor.createResourceRoots(WarStructureDeploymentProcessor.java:153)
at org.jboss.as.web.deployment.WarStructureDeploymentProcessor.deploy(WarStructureDeploymentProcessor.java:114)
... 6 more
Caused by: java.util.zip.ZipException: error in opening zip file
at java.util.zip.ZipFile.open(Native Method) [rt.jar:1.6.0_24]
at java.util.zip.ZipFile.<init>(ZipFile.java:127) [rt.jar:1.6.0_24]
at java.util.jar.JarFile.<init>(JarFile.java:135) [rt.jar:1.6.0_24]
at java.util.jar.JarFile.<init>(JarFile.java:99) [rt.jar:1.6.0_24]
at org.jboss.vfs.spi.JavaZipFileSystem.<init>(JavaZipFileSystem.java:97)
at org.jboss.vfs.spi.JavaZipFileSystem.<init>(JavaZipFileSystem.java:83)
at org.jboss.vfs.VFS.mountZip(VFS.java:408)
at org.jboss.vfs.VFS.mountZip(VFS.java:434)
at org.jboss.as.web.deployment.WarStructureDeploymentProcessor.createWebInfLibResources(WarStructureDeploymentProcessor.java:170)
... 8 more