A SOLUTION
I had this same issue today. I solved it by:
- Hide the Update causing the problem
- Check for Updates
- Install updates that were previously not available
- Restore Hidden Updates
- Check for Updates
- Install this Update but it will Fail with the same Error
- Hide this Update
- Check for Updates
- Install updates that were previously not available
- Restore Hidden Updates
- Check for Updates
The Updates that failed end up not being necessary I assume. They end up going away. But you yoou end up with a clean updated computer with no persisting Hidden Update.
I hope this helps!
My system, I have been working on a fresh install recently. I am trying what you say now (hidden the update KB3038314) and there are other updates installing now (previously blocked by KB3038314 update). I also had a look at my list of "update history" and update KB3038314 shows up as installed update for Internet Explorer 8 on 16/4/2015, five days ago. Then update KB3038314 shows up again on 17/4/2015 and is an update for Internet Explorer 11, but had failed to install, and I have tried several times after that and failed. Also version info in help menu of Internet Explorer "about" shows version 11.0.96.17728 under that it reads update version 11.0.18 (KB3038314). Does this mean update KB3038314 is already installed? I am very confused now.