This should be now fixed with xorg-server (2:1.2.0-3ubuntu5)
** Changed in: xserver-xorg-video-ati (Ubuntu)
Status: Confirmed => Fix Released
** Changed in: xorg (Ubuntu)
Status: Unconfirmed => Fix Released
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[feisty] desktop effects problem (ATI)
https://launchpad.net/bugs/90184
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