Nothing is working!

This problem has been going on for atleast a week and no one can find a solution online:
I own a fully updated (bukkit 1060) bukkit server. I have port forwarded correctly and I am running Windows 7 32 bit with duel core processor. My problem is basically when my friends join on the server. They randomly disconnect. Theres no signs or anything to tell them they just disconnect and this is the error they get:

Internal exception: java.io.IOException: Bad compressed data format

Here are all my plugins-
-ColorMe
-Deathfeed
-FakeMessage
-FLTDetector
-iConomy
-iConomyChestShop
-kFriendFinder
-LWC
-Prefixer
-Regios
-SimpleAntiGrief
-SpawnControl
-Spout
-StarterKit

And before you say "update spout" That's already done and my friends are still getting that error. I've been searching around for days and it seems no one has a solution. Oh, and btw, my friends are disconnecting, not me. I'm fine.

 

Maybe there connection is not great or maybe it's yours? Other than that I think it might be something to do with your configuration files...

 

delete plugins one by one.. Test after every plugin. This is what i do to find solution.
Also, is it happening only to your friend? If so, maybe he got modded MC?

 

My post might be able to help you.

 

I tried removing all my plugins and starting it up and that didn't work (still gets disconnected) then, I tried putting my computer downstairs to where my router is. Also, no effect and I had the best place for internet in my house. Anything else, I can't make this server public unless this is solved.