I've just dealt with another use suffering the same issue on Precise
post -26 kernel.

Aug 12 01:13:41 cc11rocks-Lemur-Ultra wpa_supplicant[1164]: Trying to associate 
with SSID 'GNU/Linux_Ubuntu=Awesome'
Aug 12 01:13:41 cc11rocks-Lemur-Ultra wpa_supplicant[1164]: Could not set 
interface wlan0 flags: Device or resource busy
Aug 12 01:13:41 cc11rocks-Lemur-Ultra wpa_supplicant[1164]: nl80211: Failed to 
set interface into IBSS mode
Aug 12 01:13:41 cc11rocks-Lemur-Ultra wpa_supplicant[1164]: Association request 
to the driver failed

In their case the device was similar:

sudo lspci -nnvv -s 2:0.0
[sudo] password for cc11rocks:
02:00.0 Network controller [0280]: Intel Corporation Centrino Advanced-N 6235 
[8086:088e] (rev 24)
        Subsystem: Intel Corporation Centrino Advanced-N 6235 AGN [8086:4060]
        Control: I/O- Mem+ BusMaster+ SpecCycle- MemWINV- VGASnoop- ParErr- 
Stepping- SERR- FastB2B- DisINTx-
        Status: Cap+ 66MHz- UDF- FastB2B- ParErr- DEVSEL=fast >TAbort- <TAbort- 
<MAbort- >SERR- <PERR- INTx-
        Latency: 0, Cache Line Size: 64 bytes
        Interrupt: pin A routed to IRQ 44
        Region 0: Memory at f7d00000 (64-bit, non-prefetchable) [size=8K]
        Capabilities: [c8] Power Management version 3
                Flags: PMEClk- DSI+ D1- D2- AuxCurrent=0mA 
PME(D0+,D1-,D2-,D3hot+,D3cold+)
                Status: D0 NoSoftRst- PME-Enable- DSel=0 DScale=0 PME-
        Capabilities: [d0] MSI: Enable+ Count=1/1 Maskable- 64bit+
                Address: 00000000fee0100c  Data: 4179
        Capabilities: [e0] Express (v1) Endpoint, MSI 00
                DevCap: MaxPayload 128 bytes, PhantFunc 0, Latency L0s <512ns, 
L1 unlimited
                        ExtTag- AttnBtn- AttnInd- PwrInd- RBE+ FLReset+
                DevCtl: Report errors: Correctable- Non-Fatal- Fatal- 
Unsupported-
                        RlxdOrd- ExtTag- PhantFunc- AuxPwr- NoSnoop+ FLReset-
                        MaxPayload 128 bytes, MaxReadReq 128 bytes
                DevSta: CorrErr- UncorrErr- FatalErr- UnsuppReq- AuxPwr+ 
TransPend-
                LnkCap: Port #0, Speed 2.5GT/s, Width x1, ASPM L0s L1, Latency 
L0 <4us, L1 <32us
                        ClockPM+ Surprise- LLActRep- BwNot-
                LnkCtl: ASPM L1 Enabled; RCB 64 bytes Disabled- Retrain- 
CommClk+
                        ExtSynch- ClockPM- AutWidDis- BWInt- AutBWInt-
                LnkSta: Speed 2.5GT/s, Width x1, TrErr- Train- SlotClk+ 
DLActive- BWMgmt- ABWMgmt-
        Capabilities: [100 v1] Advanced Error Reporting
                UESta:  DLP- SDES- TLP- FCP- CmpltTO- CmpltAbrt- UnxCmplt- 
RxOF- MalfTLP- ECRC- UnsupReq- ACSViol-
                UEMsk:  DLP- SDES- TLP- FCP- CmpltTO- CmpltAbrt- UnxCmplt- 
RxOF- MalfTLP- ECRC- UnsupReq- ACSViol-
                UESvrt: DLP+ SDES- TLP- FCP+ CmpltTO- CmpltAbrt- UnxCmplt- 
RxOF+ MalfTLP+ ECRC- UnsupReq- ACSViol-
                CESta:  RxErr- BadTLP- BadDLLP- Rollover- Timeout- NonFatalErr-
                CEMsk:  RxErr- BadTLP- BadDLLP- Rollover- Timeout- NonFatalErr+
                AERCap: First Error Pointer: 00, GenCap- CGenEn- ChkCap- ChkEn-
        Capabilities: [140 v1] Device Serial Number c4-85-08-ff-ff-40-0d-49
        Kernel driver in use: iwlwifi
        Kernel modules: iwlwifi

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https://bugs.launchpad.net/bugs/1030123

Title:
  8086:0085 Ad-Hoc wlan broken

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