That was a weird error!
I created a work file in my library, by copying an existing file from another library. I tinkered with it, loaded it with data and then wanted to rename it and store it alongside the original file in the original library. Simple enough one would think?
I renamed it in my library (simply by adding a suffix) and then tried to move it back into the original library but *boom* IBM i gets very upset and will not let me move it reporting an error message: CPF327E Alternative name for file FILENAME not allowed.
What prevents a file moving to another library when it's got a unique name?
The problem here is - it actually hasn't got a unique name. I just thought it had. But it's got a sneaky SQL long name which already exists in the original library (schema).