The following situation may cause Sync to improperly overwrite a file.
1) User 1's Sync folder contains file myfolder\myfile.txt.
2) User 2 creates the path myfolder\mysubfolder.
3) User 2 moves myfolder\myfile.txt to myfolder\mysubfolder.
4) User 2 adds a new file myfolder\myfile.txt (with different content than the file in step 1)
Sometimes, User 1's Sync client will modify myfolder\myfile.txt with the content of myfolder\mysubfolder\myfile.txt.