Polygon Feature Class from Lines not working in 10.1 sp1

I need to build polygons from lines and points using the "Polygon Feature Class from Lines" topology tool in ArcCatalog. I'm using ArcGIS 10.1 SP1 and the tool just gets hung up and never finishes. I've tried it now on 5 different machines, three of which do not have sp1 and the tool works fine on these sp1-less machines. If I update to SP1, the tool will no longer work. The two machines that already had sp1 do not work.

I have a call in with tech support but the tool works fine on their end with SP1. Please try using this tool on your machine with or without sp1 and let me know if it works. Thanks.