ID 572526 - Moving items around in this scene file results in a hang

Problem summary
Moving items around in this scene file results in a hang.
 
Customer reported version
Modo 17.0v1
 
Customer reported platform
Windows 10
 
Steps to reproduce
 
1) Download the attached file and open it in Modo.

2) Navigate to the Scenes Viewport and expand the "option_1" folder, then select all the contents.

3) Use RMB > Duplicate > Instance, then Ctrl + G to add the newly duplicated items t a folder.
 
4) Drag the newly created folder out of the "option_1" folder and observe the results.
 
Expected behavior
The file should remain stable when moving folders in the Scenes Viewport.
 
Actual behavior
The file does not remain stable when moving folders in the Scenes Viewport.
 
Workaround
Unknown.
 
Reproduced by Support in:
Modo 17.0v1 - Windows 11, macOS 11.7 Big Sur - regression
 
Unable to reproduce bug in:
Modo 16.1v8 - Windows 11, macOS 11.7 Big Sur
 
Earliest version tested
Modo 16.1v8 - This issue doesn't appear in this version and has regressed.