Really Weird issue with Java and mouse

I apologize ahead of time if i am vague in some of my details, i can find more information if more is needed. I work on the helpdesk for a pretty large not-for-profit company and we have begun to see a bit of weirdness that seems to revolve around Java in some way.
Alittle Backgroud:

We have an in-house built application that runs heavy on Java, again, i can get more details when needed. It runs fabulously 99% of the time, it is just that recently we have see a growing trend on our Windows XP desktops. The program will be up and running, no issues, the user will then begin doing something else, it seems most of the time it is in IE 8 (web based) and then switch back to the Java application and find that the mouse no longer works within the application. You cannot click on anything, menus, close window x in the corner, nothing. Keyboard commands, alt+whatever, still work and tab allows you to navigate throughout the application fine. The only solution is to reboot the computer and then it works fine. PLUS, if we go into control panel and then open the Java Control Panel, that also doesn't respond to mouse clicks as well, but tab and enter works fine.
It has happened on multiple different computers in the company, same configuration, but never accessing the same thing or doing the same task, yet something seems to be breaking the java or something. We have tried to turn on the logging in Java Console, it shows nothing useful. We have checked event viewers, NOTHING at all.
We are unable to recreate it and it seems to happen at random times but always crashes mouse functionality in JAVA. It is really getting frustrating to the IT dept as well as the user base and i was just wondering if anyone has seen ANYTHING similar to this or have any suggestions to trying to track down the culprit process/program doing this.

Any Help would be appreciated.

Thanks

Hi allnyguy and welcome to Dev Shed.

On the workstations that this is happening on, are they all running XP and running the same version of JRE ?

All the computers affected are windows xp sp3, same version of jre. All use the same java application, but they are all doing something differentwhen local java loses mouse functionality. The common thing is they all have IE open.

And are they all running the same version of IE ?

Do any users using the application run Windows 7 (or, even Vista for that matter!) ? If so, are they experiencing any issues ?

Nope, it is strictly a windows xp shop when it comes to the general public in the company. Windows 7 is only used with the development team and since we dont' know what is causing it, we can't duplicate it...

we tried to turn on logging in the java console and nothing came up helpful as well.