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Thanks, however I did solve the problem. It turns out that Steam was set to run as administrator on the executable. When I removed run as administrator the compiler began working properly so all is good    :)

It was the model compiler and the texture compiler. Got the same error for both. Steam did update yesterday after I restarted several times while still getting the same result. I rebooted my computer and then steam updated, but the same error just continued.

I have been trying to compile a model i made in 3dsmax into the source sdk but i get too errors that prevent me from compiling.

The first error is
SteamStartup() failed: SteamStartup(0xf,0x0046F838) failed with error 1: failed to take master pipe connection lock

After I get this error I try to run sdk from steam and it won't open. I have to restart steam to get sdk to actually open.

When i try to compile while sdk is open istill get this error message.

Anyone know of any possible solutions