it's the ****ty threads, on the ****ty cog, made to ****ty tolerances. this also happened to me w/ a formula hub... and that day happened to be riding a ****ty 15T cog. ****ty cogs aren't case hardened, nor are their threads deburred.
my point is the threads on teh ****ty cog will become subjected to the occassional dirt and debree... the threads will show chipping, warping, etc. the distorted steel threads will cut into the hub's aluminum threads everytime you thread it on.
formula isn't at fault, the cog is the culprit.... be happy it wasn't a nice hub.
p.s. stick w/ eai cogs or dura ace.