Steps to reproduce together with full stack trace from current bzr.dev. I guess this might be mainly useful as a unit test case. Notice that thet error will leave a stale lock in place, which I'd consider another error. Imho all locks should be released using suitable 'finally' clauses. Or is the connection unusable after this error occurred?

$ bzr init -q trunk
$ echo one > trunk/foo
$ bzr add -q trunk/foo
$ bzr commit -q -m one trunk
$ bzr branch -q trunk branch
$ echo two > branch/foo
$ bzr commit -q -m two branch
$ bzr checkout bzr+ssh://localhost/${PWD}/trunk checkout
$ bzr pull -d checkout bzr+ssh://localhost/${PWD}/branch
bzr: ERROR: bzrlib.errors.TooManyConcurrentRequests: The medium 'SmartSSHClientMedium(bzr+ssh://None@localhost/)' has reached its concurrent request limit. Be sure to finish_writing and finish_reading on the currently open request.

Traceback (most recent call last):
  File "bzrlib/commands.py", line 918, in exception_to_return_code
    return the_callable(*args, **kwargs)
  File "bzrlib/commands.py", line 1118, in run_bzr
    ret = run(*run_argv)
  File "bzrlib/commands.py", line 676, in run_argv_aliases
    return self.run(**all_cmd_args)
  File "bzrlib/commands.py", line 698, in run
    return self._operation.run_simple(*args, **kwargs)
  File "bzrlib/cleanup.py", line 135, in run_simple
    self.cleanups, self.func, *args, **kwargs)
  File "bzrlib/cleanup.py", line 165, in _do_with_cleanups
    result = func(*args, **kwargs)
  File "bzrlib/builtins.py", line 1080, in run
    show_base=show_base)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/workingtree.py", line 1013, in pull
    local=local)
  File "bzrlib/branch.py", line 1103, in pull
    possible_transports=possible_transports, *args, **kwargs)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/branch.py", line 3367, in pull
    run_hooks=False)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/remote.py", line 2992, in pull
    _override_hook_target=self, **kwargs)
  File "bzrlib/branch.py", line 1103, in pull
    possible_transports=possible_transports, *args, **kwargs)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/branch.py", line 3372, in pull
    merge_tags_to_master=not source_is_master)
  File "bzrlib/branch.py", line 3502, in _pull
    graph=graph)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/branch.py", line 3315, in _update_revisions
    self.fetch(stop_revision=stop_revision)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/branch.py", line 3292, in fetch
    fetch_spec=fetch_spec)
  File "bzrlib/remote.py", line 1660, in fetch
    find_ghosts=find_ghosts, fetch_spec=fetch_spec)
  File "bzrlib/decorators.py", line 217, in write_locked
    result = unbound(self, *args, **kwargs)
  File "bzrlib/vf_repository.py", line 2512, in fetch
    find_ghosts=find_ghosts)
  File "bzrlib/fetch.py", line 75, in __init__
    self.__fetch()
  File "bzrlib/fetch.py", line 102, in __fetch
    self._fetch_everything_for_search(search_result)
  File "bzrlib/fetch.py", line 130, in _fetch_everything_for_search
    stream, from_format, [])
  File "bzrlib/remote.py", line 2106, in insert_stream
    (verb, path, resume_tokens) + lock_args, byte_stream)
  File "bzrlib/smart/client.py", line 181, in call_with_body_stream
    expect_response_body=False)
  File "bzrlib/smart/client.py", line 79, in _call_and_read_response
    readv_body=readv_body, body_stream=body_stream)
  File "bzrlib/smart/client.py", line 61, in _send_request
    encoder.call_with_body_stream((method, ) + args, body_stream)
  File "bzrlib/smart/protocol.py", line 1277, in _iter_with_errors
    yield None, iterator.next()
  File "bzrlib/smart/repository.py", line 519, in _stream_to_byte_stream
    for substream_type, substream in stream:
  File "bzrlib/remote.py", line 2291, in missing_parents_chain
    for kind, stream in self._get_stream(sources[0], search):
  File "bzrlib/remote.py", line 2237, in _get_stream
    verb, args, search_bytes)
  File "bzrlib/remote.py", line 79, in _call_with_body_bytes_expecting_body
    method, args, body_bytes)
  File "bzrlib/smart/client.py", line 170, in call_with_body_bytes_expecting_body
    method, args, body=body, expect_response_body=True)
  File "bzrlib/smart/client.py", line 79, in _call_and_read_response
    readv_body=readv_body, body_stream=body_stream)
  File "bzrlib/smart/client.py", line 45, in _send_request
    protocol_version)
  File "bzrlib/smart/client.py", line 115, in _construct_protocol
    request = self._medium.get_request()
  File "bzrlib/smart/medium.py", line 734, in get_request
    return SmartClientStreamMediumRequest(self)
  File "bzrlib/smart/medium.py", line 992, in __init__
    raise errors.TooManyConcurrentRequests(self._medium)
TooManyConcurrentRequests: The medium 'SmartSSHClientMedium(bzr+ssh://None@localhost/)' has reached its concurrent request limit. Be sure to finish_writing and finish_reading on the currently open request.

bzr 2.5.0dev1 on python 2.7.2 (Linux-3.0.3-gentoo-x86_64-AMD_Phenom-tm-_II_X4_945_Processor-with-gentoo-2.0.3)
arguments: ['bzr', '--no-plugins', 'pull', '-d', 'checkout', 'bzr+ssh://localhost//.../branch']
plugins:
encoding: 'UTF-8', fsenc: 'UTF-8', lang: 'de_DE.utf8'

*** Bazaar has encountered an internal error.  This probably indicates a
    bug in Bazaar.  You can help us fix it by filing a bug report at
        https://bugs.launchpad.net/bzr/+filebug
    including this traceback and a description of the problem.
$ cat trunk/foo
one
$ echo three > trunk/foo
$ bzr commit -m three trunk
Unable to obtain lock file:///.../trunk/ held by ... on ... (process #...), acquired 0 seconds ago.
Will continue to try until ..., unless you press Ctrl-C.
See "bzr help break-lock" for more.
^C