When using Microsoft Office Communicator 2007 R2, double-clicking a Contact fails to launch a new conversation window.  However, you are still able to right-click a Contact, and start an IM session by selecting “Send an Instant Message.”

Cause: When double-clicking a Contact, OC 2007 R2 uses XML to initialize a new conversation window, and we’re finding several customers who have incompatible and/or legacy builds of MSXML.DLL that are encountering these failures.

Resolution: To resolve this issue, please install XML Version 6.0 and XML Version 3.0 SP7.

• Microsoft Core XML Services (MSXML) 6.0 http://www.microsoft.com/downloads/details.aspx?FamilyID=993C0BCF-3BCF-4009-BE21-27E85E1857B1&displaylang=en
• Microsoft XML Parser (MSXML) 3.0 Service Pack 7 (SP7) http://www.microsoft.com/downloads/details.aspx?familyid=28494391-052b-42ff-9674-f752bdca9582&displaylang=en

Thanks to Scott Oseychik for posting the solution here: http://blogs.msdn.com/scottos/archive/2009/09/25/communicator-2007-r2-fails-to-open-new-window-when-double-clicking-a-contact.aspx