It happened to me as well. It's the single worst gameplay problem in my humble opinion because it makes what should be a reward into a horrible glitch!
I'm gonna bump this thread because there's an even more annoying glitch with this. When you get a badge, not only will your screen freeze for two minutes, but all your repeatable quests will be shown as completed and removed from your quest list without you getting any rewards.
You've got to run back and start the quest again before you can continue. You don't lose your progress, but still really annoying.
You know... I keep hearing about all the crashing and everything caused by this... but... I've never had this happen more then 30 seconds, and everything was fine afterward (you know, besides mobbing).neutral
As a side note, the badges in the sewer don't seem to have this problem, either.