diff --git a/compiler/frontend/src/org/jetbrains/jet/lang/cfg/pseudocode/Pseudocode.java b/compiler/frontend/src/org/jetbrains/jet/lang/cfg/pseudocode/Pseudocode.java
index b4565b36517..659504f0578 100644
--- a/compiler/frontend/src/org/jetbrains/jet/lang/cfg/pseudocode/Pseudocode.java
+++ b/compiler/frontend/src/org/jetbrains/jet/lang/cfg/pseudocode/Pseudocode.java
@@ -315,7 +315,7 @@ public class Pseudocode {
     }
     
     private void collectAllowedDeadInstructions(Instruction allowedDeadInstruction, Set<Instruction> instructionSet, Set<Instruction> stopAllowDeadInstructions) {
-        if (stopAllowDeadInstructions.contains(allowedDeadInstruction)) return;
+        if (instructionSet.contains(allowedDeadInstruction) || stopAllowDeadInstructions.contains(allowedDeadInstruction)) return;
         if (((InstructionImpl)allowedDeadInstruction).isDead()) {
             instructionSet.add(allowedDeadInstruction);
             for (Instruction instruction : allowedDeadInstruction.getNextInstructions()) {
diff --git a/compiler/testData/diagnostics/tests/controlFlowAnalysis/kt1189.jet b/compiler/testData/diagnostics/tests/controlFlowAnalysis/kt1189.jet
new file mode 100644
index 00000000000..c3fef37b9cc
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/controlFlowAnalysis/kt1189.jet
@@ -0,0 +1,39 @@
+//KT-1189 StackOverflow in ide
+package kt1189
+//+JDK
+import java.util.concurrent.locks.ReentrantReadWriteLock
+
+inline fun <erased T> ReentrantReadWriteLock.write(action: ()->T) : T {
+    val rl = readLock().sure()
+    var readCount = 0
+    val writeCount = getWriteHoldCount()
+    if(writeCount == 0) {
+        readCount = getReadHoldCount()
+        if(readCount > 0)
+            for(i in 1..readCount)
+                rl.unlock()
+    }
+
+    val wl = writeLock().sure()
+    wl.lock()
+    try {
+        return action()
+    }
+    finally {
+        if(readCount > 0) {
+            for(j in 1..readCount) {
+                rl.lock()
+            }
+        }
+        wl.unlock()
+    }
+}
+
+fun foo() {
+    try {
+        return
+    }
+    finally {
+        for (i in 1..10) {}
+    }
+}
\ No newline at end of file