Hey Heybob,
Smoothcam definitely has its quirks, and it handles every video clip differently. In your particular situation, it's just the nature of the visual elements. The dude is wearing a white tux, and when camera flashes go off, the woman's dress (and everything else) becomes a large white shape as well, and Smoothcam doesn't recognize them as the same two figures.
I've encountered similar situations with tracking shots, where a car or a person goes right in front of the lens. In those situations, there's nothing you can do to "reprogram" Smoothcam... you just have to razor blade at the beginning and end of the offending moment, and blend as best you can.
So you can try that with your clip, but from the looks of it, that particular shot doesn't need stabilization anyway.
I think we can all agree that Smoothcam is not a cure-all, but it's a tool in the toolbox to make the end product a little bit better.