I can't really provide useful additional information, but I just had the same
issue. An UPDATE with RETURNING statement was consistently failing after
being called 5 or 6 times. After restarting my app server (which use
postgres jdbc driver), the update query would work again 5-6 times, then
fail.
Recreating the table also made the issue disappear (thanks Corey). I tried
vacuum etc, without success.
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http://postgresql.nabble.com/BUG-14406-Statement-fails-after-upgrade-to-9-6-1-tp5928404p5932143.html
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