Possible MySQL issue?

I'm setting up Open-AudIT. I ran the setup.php and entered in the database information. It created the database flawlessly. I clicked next and got this...

Code:

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Connecting to 192.168.10.18 as root.          Connected.       
Setting up data in tables.
Query failed. Query was:
SET PASSWORD FOR 'root'@'%' = OLD_PASSWORD('mypw4thedb')

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I'm thinking it is just a problem on my end. What is the deal and how do I fix it? Any suggestions?

I'm running phpMyAdmin and everything is hosted on a SUSE box. ANY help would be appreciated.

I commented out the strings forming the error in setup_2.php - works fine now.