I just had this error as well. I accidentally fired up my Avid without turning on my RAID drive. All the media came up RED (offline). Ok, no biggie. Reboot the system.
After the reboot all of my media that was linked from Sony EX3 AMA files came back, but now I had this error and I couldn’t play the timeline. Several restarts didn’t fixed it, and I noticed that 10% of the clips in the timeline still showed offline. No coincidence- the offline clips were the shots that came from a Canon DSLR (Imported via AMA).
What eventually fixed it: I had to open each bin that contained the DSLR raw footage. After I opened the bin, the footage within it now showed up online on the timeline. I kept getting that error message as I went, but I just kept clicking OK. After I opened each bin with DSLR footage, the timeline no longer showed offline files, and now no more error message and a timeline that plays. 🙂 I hope that helps anyone still having this issue.
I plan on transcoding the timeline to DNXHD, but want to finish the cut before I do that.