Taken from a Nortel bulletin:
Can't create OTM authentication instance 800706ba
Problem Description
Fact:
Nortel Communication Server 1000 Telephony Manager
Optivity Telephony Manager
OTM
Client receives IP address via DHCP
Previously logged on
Symptom:
Can't create OTM authentication instance 800706ba
Authentication fails
Error: Can't create OTMAuthentication Instance
Event Log

COM got error "Class not registered" from the computer <Name> when attempting to activate the server...
Error: Authentication: 800706BA
Cause:
The 800706BA number means: Could not connect to the server. There are multiple causes that produce the error message.
A. Lease on IP address expired. Machine has a new IP address.
B General networking issues.
C. Client or server cannot resolve IP address from host name.
D. OTM was installed on the server using an account that was not a member of Administrators group
E. Software/settings on Client PC are preventing RPC from operating as intended.
Note: Review the PC Event Log and look for Service Control Manager having Issues.
Problem Resolution
Fix:
A. Edit client's IP address on server to match the new address:
1. From the Navigator window select Utilities, then Clients.
2. Highlight the correct machine name.
3. Click the Edit button.
4. Replace the IP address.
5. Click OK.
Do not remove the entire entry because the only way to restore it is to re-install the client.
Notebook users who frequently connect to different subnets may prefer to use the Web Client instead of constantly editing their IP address at the server.
B. Verify that the server exists, that it has correct network and DNS settings, and that the credentials supplied have administrative privileges on the server. Ensure port 135 is not being blocked by a router.
C. Build a Hosts table on the Client resolving the Sever IP to the Server Name and on the Server to resolve the Client IP to Client Name. Also, build an LMHosts table, see Optivity Telephony Manager Installation and Configuration (553-3001-230 September 2004) for OTM 2.2 starting at page 311.
Or
On the client PC: Go to Control Panel-->Administrative Tools-->Component Services-->Computers-->My Computer-->COM+ Application-->Right click on OTM Application-->Properties-->Activation-->Under Remoter PC ensure that the name entered is the name of the OTM server, if not edit to match server.
D. Un-install and re-install Nortel Communication Server 1000 Telephony Manager (formerly known as OTM) using the correct account.
E. Verify that The Operating System has the correct SP and verify that Q823980 hot fix has been installed.
OR
Re-install the operating system and patches, then re-install Nortel Communication Server 1000 Telephony Manager (formerly OTM).