This bug was fixed in the package ecryptfs-utils - 96-0ubuntu3

---------------
ecryptfs-utils (96-0ubuntu3) precise; urgency=low

  * src/utils/ecryptfs-setup-swap: Skip /dev/zram* swap devices
    (LP: #979350).
 -- Colin Watson <[email protected]>   Wed, 18 Apr 2012 15:52:45 +0100

** Changed in: ecryptfs-utils (Ubuntu Precise)
       Status: New => Fix Released

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https://bugs.launchpad.net/bugs/979350

Title:
  install with encrypted home failed near the end: OSError: [Errno 12]
  Cannot allocate memory

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