It was supposed to work... what OS version and what's the path of the fgrep program you're using ? If you're using solaris, try to use the fgrep located on /usr/xpg4/bin, instead of the one on /bin directory.
These aren't exactly the problem you're having, but they're similar in that certain commands hit their limit with some sort of list and produce an error:
Like jsilva said, it'll help if you say what operating system / shell both servers are currently running - the one the command's working on and the one it's not.