Multiplicity loses keyboard input when laptop lid closed

I'm testing out Multiplicity and noticed something odd. When I close the lid to my laptop, I lose keyboard input. When I open the laptop so the screen re-engages, keyboard input comes back.

I had a KVM switch connected previously. As long as the laptop was connected to it (thinking it had an external monitor), this problem did not occur.

Anyone else seen this type of behavior?

Thanks!