Here is the code. IE7 spouts an \"\'active.0\' is null or not an object\" error on line 39, which is:
input.trigger(\"activate.autocomplete\", [$.data(active
Check out:
http://github.com/istruble/jquery-autocomplete/commit/bdc926bd2c18c3ebab4e31463a8ae899fd761316#diff-1
It is a version of jquery.ui.autocomplete.js with most of the IE 7 issues fixed. I found a few more issues which I listed at the bottom along with how to fix them.