Line 417 states "timer_entry_ptr = (TIMER_ENTRY_STRUCT_PTR)_mem_alloc_system_zero( ......."
Then lines 448 and following state:
"if (_lwsem_wait(&timer_component_ptr->TIMER_ENTRIES_LWSEM) != MQX_OK)
{
_task_set_error(MQX_INVALID_LWSEM);
return(TIMER_NULL_ID);
}"
... thus exiting without freeing timer_entry_ptr.