Using the instructions from www.deltacloud.org, the deltacloud core is installed via rubygems. If an update (sudo gem update), the rack component will attempt to update to 1.2.1, however, this causes the deltacloudd server to fail and one must uninstall rack to 1.1.0. The deltacloud team has been assigned a bug: https://bugzilla.redhat.com/show_bug.cgi?id=646633 to fix this.