The Capacity Error is caused when an item is included in a shipment which Amazon believes has poor ranking and Amazon already has too many in stock.

The item needs to be removed from the shipment before you can ship the shipment.

The only solution to this is to list the item as Merchant Fulfilled from your Seller Central account until more warehouse space is available.  VHS tapes are a good example of this.  To read more about quantity limits visit: