Time Machine Could Not Complete Backup (Error -1)

I have a Time Capsule that started to report errors and failing to back up. The first error was -109. So I researched it and performed a couple Terminal commands. Back ups still didn't take so I then erased the disk via Airport Utility on the Disk pane. Just did a quick-erase. Back ups again didn't take. What would happen is it would start to do a full system back up and then just stop at some point in the process. No errors were reported. I also have the machine connected via Ethernet instead of wireless during this testing. Next I erased the drive again using Airport Utility, but this time zeroed out all the data. When attempting to back up next it was asked if I wanted to use the disk since characteristics of the disk had changed from zeroing out. Now I get this error -1 and haven't bothered to spend much more time. I only have about 1 more week and change left on the warranty so I'll hit up AppleCare when they open next week, but does anyone know what may be the deal here? Below is output from Console.
12/25/10 8:25:34 AM com.apple.backupd[6720] Error -1 creating backup disk image
12/25/10 8:25:34 AM com.apple.backupd[6720] Failed to create disk image /Volumes/Time Machine/iMac.sparsebundle, status: -1
12/25/10 8:25:39 AM com.apple.backupd[6720] Backup failed with error: 20
12/25/10 8:25:39 AM kernel AFP_VFS afpfs_unmount: /Volumes/Time Machine, flags 0, pid 6745
12/25/10 8:25:39 AM com.apple.backupd[6720] Ejected Time Machine network volume.
Thanks.

Crees! wrote:
12/25/10 8:25:34 AM com.apple.backupd[6720] Failed to create disk image /Volumes/Time Machine/iMac.sparsebundle, status: -1
It can't create the sparse bundle to put your backups in. Considering the history, the internal HD is most likely dying.
You may want to make an appointment at the Genius Bar of your local Apple Store; they may test it a bit and just hand you a new/refurbished one.

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