I am seeing the same error. I am new to minecraft forge - I keep a Minecraft Server running for my son and his friends - they asked me to figure out if I could add mods to the server, so I started fiddling with it. Managed to get forge 1.7.10 installer and get it working, sort of, with my 1.7.10 server. When I run forge, it opens the MCServer jar file ok, and all looks fine till someone tries to login to my server. Below is the Log/chat text -- with some repetitive lines removed.
[20:34:52] [main/INFO] [LaunchWrapper]: Loading tweak class name cpw.mods.fml.common.launcher.FMLServerTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Using primary tweak class name cpw.mods.fml.common.launcher.FMLServerTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.common.launcher.FMLServerTweaker
[20:34:52] [main/INFO] [FML]: Forge Mod Loader version 7.10.18.1180 for Minecraft 1.7.10 loading
[20:34:52] [main/INFO] [FML]: Java is Java HotSpot 64-Bit Server VM, version 1.7.0_60, running on Windows 7:amd64:6.1, installed at C:\myd\1_7_10_MMSMOD\JDK64_7_60\jre
[20:34:52] [main/INFO] [LaunchWrapper]: Loading tweak class name cpw.mods.fml.common.launcher.FMLInjectionAndSortingTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Loading tweak class name cpw.mods.fml.common.launcher.FMLDeobfTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.common.launcher.FMLInjectionAndSortingTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.common.launcher.FMLInjectionAndSortingTweaker
[20:34:52] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.relauncher.CoreModManager$FMLPluginWrapper
[20:34:54] [main/INFO] [FML]: Found valid fingerprint for Minecraft Forge. Certificate fingerprint e3c3d50c7c986df74c645c0ac54639741c90a557
[20:34:54] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.relauncher.CoreModManager$FMLPluginWrapper
[20:34:54] [main/INFO] [LaunchWrapper]: Calling tweak class cpw.mods.fml.common.launcher.FMLDeobfTweaker
[20:34:55] [main/INFO] [LaunchWrapper]: Launching wrapped minecraft {net.minecraft.server.MinecraftServer}
[20:34:59] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Starting minecraft server version 1.7.10
[20:34:59] [server thread/INFO] [MinecraftForge]: Attempting early MinecraftForge initialization
[20:34:59] [server thread/INFO] [FML]: MinecraftForge v10.13.0.1180 Initialized
[20:34:59] [server thread/INFO] [FML]: Replaced 182 ore recipies
[20:34:59] [server thread/INFO] [MinecraftForge]: Completed early MinecraftForge initialization
[20:35:00] [server thread/INFO] [FML]: Searching C:\myd\1.7.10 MMSJar\mods for mods
[20:35:00] [server thread/INFO] [FML]: Forge Mod Loader has identified 3 mods to load
[20:35:02] [server thread/INFO] [FML]: Processing ObjectHolder annotations
[20:35:02] [server thread/INFO] [FML]: Found 341 ObjectHolder annotations
[20:35:02] [server thread/INFO] [FML]: Configured a dormant chunk cache size of 0
[20:35:02] [server thread/INFO] [FML]: Applying holder lookups
[20:35:02] [server thread/INFO] [FML]: Holder lookups applied
[20:35:02] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Loading properties
[20:35:02] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Default game type: CREATIVE
[20:35:02] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Generating keypair
[20:35:02] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Starting Minecraft server on *:25564
[20:35:04] [server thread/INFO] [FML]: Forge Mod Loader has successfully loaded 3 mods
[20:35:04] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Preparing level "world"
[20:35:04] [server thread/INFO] [FML]: Injecting existing block and item data into this server instance
[20:35:04] [server thread/INFO] [FML]: Applying holder lookups
[20:35:04] [server thread/INFO] [FML]: Holder lookups applied
[20:35:04] [server thread/INFO] [FML]: Loading dimension 0 (world) (net.minecraft.server.dedicated.DedicatedServer@6016abf5)
[20:35:04] [server thread/INFO] [FML]: Loading dimension 1 (world) (net.minecraft.server.dedicated.DedicatedServer@6016abf5)
[20:35:05] [server thread/INFO] [FML]: Loading dimension -1 (world) (net.minecraft.server.dedicated.DedicatedServer@6016abf5)
[20:35:05] [server thread/INFO] [net.minecraft.server.MinecraftServer]: Preparing start region for level 0
[20:35:06] [server thread/INFO] [net.minecraft.server.MinecraftServer]: Preparing spawn area: 2%
[20:35:07] [server thread/INFO] [net.minecraft.server.dedicated.DedicatedServer]: Done (3.456s)! For help, type "help" or "?"
[20:37:06] [user Authenticator #1/INFO] [net.minecraft.server.network.NetHandlerLoginServer]: UUID of player arch55 is 241e7b3e-5098-41fb-8005-9ac828971d0d
[20:37:09] [Netty IO #1/INFO] [FML]: Unexpected packet during modded negotiation - assuming vanilla or keepalives : net.minecraft.network.play.client.C00PacketKeepAlive
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[20:37:50] [Netty IO #1/INFO] [FML]: Unexpected packet during modded negotiation - assuming vanilla or keepalives : net.minecraft.network.play.client.C00PacketKeepAlive
[20:37:52] [Netty IO #1/INFO] [FML]: Unexpected packet during modded negotiation - assuming vanilla or keepalives : net.minecraft.network.play.client.C00PacketKeepAlive
[20:37:54] [server thread/INFO] [net.minecraft.network.NetHandlerPlayServer]: arch55 lost connection: TextComponent{text='Disconnected', siblings=[], style=Style{hasParent=false, color=null, bold=null, italic=null, underlined=null, obfuscated=null, clickEvent=null, hoverEvent=null}}
[20:37:54] [server thread/INFO] [net.minecraft.server.MinecraftServer]: arch55 left the game
So, I'm not sure what to try. I see several other folks have experienced the same error message -- it only stops repeating when the user attempting to login gives up.
Here is the string I'm using to start up the server, perhaps I've accidentally done something wrong here?
C:\myd\1_7_10_MMSMOD\JDK64_7_60\bin\java.exe -Xmx1024M -Xms1024M -jar forge-1.7.10-10.13.0.1180-universal.jar
Thanks!