I am facing this issue in 14.04 and also in 16.04.

Thanks to breezer(jgbreezer)'s comment. Whenever I face this issue, I am
running this command to fix it.

"pkill nautilus"


Source: 
https://bugs.launchpad.net/ubuntu/+source/rapidsvn/+bug/402892/comments/12

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https://bugs.launchpad.net/bugs/402892

Title:
  Mouse cursor gets stuck in "drag and drop" mode

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