Update:

The following issues have been resolved:

• Realms on battlegroup Retaliation (http://www.worldofwarcraft.com/pvp/battlegrounds/battlegroups/) are now back online. Characters on these realms should note that their fires and holiday quests are now reset.
  
• Characters of all levels should now be able to pick up the daily quest "Striking Back."

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Update:

We're currently aware of and looking into the following reports:

• All annual quests were reset with this hotfix. As a result, many players may note that their completed quest totals have been lowered to properly account for the loss. These quests may be completed again, though, and will continue to count towards a character's current total. Also, if these quests previously contributed to the completion of an achievement (for example: "Complete 3000 Quests"), their reset will not remove a character's achievement credit in any way. Once completed, these achievements will remain.
  
• Totemic Beacons are unable to be reclaimed if destroyed. Players who are wishing to complete "Inform the Elder" are welcome to request further assistance by submitting an in-game petition.
  
• Some players are unable to pick up "Unusual Activity." This quest is not considered an annual quest and so did not reset. If you completed this quest last year, you will be unable to repeat it. The same applies for "Ahune, the Frost Lord," "Shards of Ahune, "Incense for the Summer Scorchlings," and "Incense for the Festival Scorchlings."
  
• If players completed "A Thief's Reward" prior to their realm's reset, it's possible they may be able to complete it again and receive more than one Crown of the Fire Festival.
  
• With this, if players stole any city fires prior to Tuesday's hotfix, they may need to doubleback and re-complete them in order to pick up a "A Thief's Reward."
  
• Some players are receiving the message "You have already completed that quest" when attempting to steal Exodar and Silvermoon fires. These fires, unlike all other cities', are not considered annual quests, so may have not properly reset. If you receive this message, but are unable to pick up "A Thief's Reward," it's very likely that you still have another city's flame missing.
  
• If players receive the message "Quest Failed: Duplicate Item Found," they will need to select a different quest reward during quest turn in. Some of the quest rewards are considered "Unique (20)," capping out at a stack of 20. If one of these rewards is chosen during quest turn in, but would bring a player's item count over the unique cap, the quest will not complete.
  
• Some players are noting that achievements in-progress have not reset even though all fires and quests have (allowing them to be honored or stolen even if listed in an achievement's progress).

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Update:

http://forums.worldofwarcraft.com/thread.html?topicId=17631614070&postId=180294811622&sid=1#10

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Q u o t e:
We are in the process of applying an in-game fix that will restart all of the quests associated with the Midsummer Fire Festival event and allow players to complete them once again. If you are in the process of completing an achievement such as Extinguishing Kalimdor, this fix will reset your progress and you will need start over. This fix will require realms to be restarted.

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Greetings!

While the Midsummer Fire Festival event has begun, we wanted to take some time to explain that there are some currently known issues with the Festival, and to let the community know that we are working on resolving them.

The first issue, and what seems to be the most prevalent reported issue, is regarding gaining Fire Blossoms from fire quests that were completed last year. This affects the Honor the Fires and Desecrate the Fires quests, as they appear to have not reset from last year. We understand the concerns many players have about being able to obtain enough blossoms for this year to buy what they wish, and we are actively working on the issue.

Second, there have been many reports that the quest “Unusual Activity” has not reset from last year. This is being investigated by development.

In addition, we have had many players report that Crown of the Fire Festival from last year is not granting achievement credit for King of the Fire Festival. This appears to be a result of the quest not having been completed while the achievement system was live (as last Midsummer was before the achievement system was implemented). If it were to grant retroactive achievement for King of the Fire Festival, it would have been granted upon launch of the achievement system.

While we do apologize for any frustration, we want to actively assure the community that we are working on resolving these issues, and any others that may appear. We will update this post with information as we get it.