Question : Delivery not authorized, message refused. 550-5.7.1 Message targeted to organization's federated delivery mailbox.

This error message occurs when users, who have a mailbox on Exchange 2003, attempt to send an email to an Exchange 2003 query-based distribution group that includes Exchange 2010 users in 2003/2010 mixed environment. The error is only returned for the Exchange 2010 recipients.

We've installed 982639  - Update Rollup 4 for Exchange Server 2010 mentioned by http://support.microsoft.com/kb/979517 with no success.

Exchange 2003 Standard Edition is running latest service pack on Windows 2003 Enterprise with SP2.

Exchange 2010 Standard Edition is running latest service pack on Windows 2008 Datacenter R2.

Your assistance is appreciated.

Answer : Delivery not authorized, message refused. 550-5.7.1 Message targeted to organization's federated delivery mailbox.

For anyone else that comes across this problem, the way to deal with this is to create a new query-based distribution group in Exchange 2010 and then rebuild the offline address book. As long as support is turned on for Outlook 2003 SP2 on the Exchange 2010 Server, the old Outlook 2003 clients will receive the new query-based distribution group.