Comment 7 for bug 695887

Thank you for taking the time to report this bug and helping to make Ubuntu better. The version of update-initramfs that you likely have installed is unable to work on a persistent usb stick. You can resolve this issue by upgrading the version of casper on your system. This can be done via the commands:

sudo apt-get update; sudo apt-get install casper

Then performing the software update or installation that you were originally trying. If this does resolve your bug please set its status to Invalid. Thanks in advance!