This issue was originally filed by @butlermatt

What steps will reproduce the problem?

1. Use simple code such as the following:

hello(msg, to, [from, rate]) => '${from} sent ${msg} to ${to} via ${rate}';

main() => print(hello('world', 'Seth', from:'Bob', rate:'First Class'));

(Taken from Seth Ladd's blog post on functions)

1. Try to run sample in dartVM:
   dart Test.dart

What is the expected output? What do you see instead?
Expected to see:
"Bob sent world to Seth via First Class"

Received:
Error: line 3 pos 44: unexpected token ':'
main() => print(hello('world', 'Seth', from:'Bob', rate:'First Class'));

What version of the product are you using? On what operating system?
Using Pre-built SDK from:
http://gsdview.appspot.com/dart-editor-archive-integration/latest/
File: dart-linux.zip (Timestamp 16-Jan-2012 18:43)

Ubuntu 11.10 64-bit

Please provide any additional information below.
This works as expected in dartboard, compiles as expected with frogc.