I asked the theme developer, and they haven’t had time to look at the issue. Seems like an issue with the following code.
<ul id="archives">
<?php while(have_posts()) : the_post(); ?>
<?php $thumb = get_post_meta($post->ID, 'thumbnail', $single = true); ?>
<li>
<?php if($thumb !== '') { ?>
<a title="<?php echo the_title(); ?>" href="<?php the_permalink() ?>"><img class="thumbarch" src="<?php echo $thumb; ?>" alt="<?php echo the_title(); ?>" /></a>
<?php } else { ?>
<a title="<?php echo the_title(); ?>" href="<?php the_permalink() ?>"><img src="<?php bloginfo('template_url'); ?>/images/default.gif" alt="<?php echo the_title(); ?>" /></a>
<?php } ?>
</li>
<?php endwhile; ?>
</ul>