My understanding is that there are duplicate references to the same API (Likely different version numbers). It should be reasonably easy to debug when building from the command line.
Try ./gradlew yourBuildVariantName --debug
from the command line.
The offending item will be the first failure. An example might look like:
14:32:29.171 [INFO] [org.gradle.api.Task] INPUT: /Users/mydir/Documents/androidApp/BaseApp/build/intermediates/exploded-aar/theOffendingAAR/libs/google-play-services.jar
14:32:29.171 [DEBUG] [org.gradle.api.internal.tasks.execution.ExecuteAtMostOnceTaskExecuter] Finished executing task ':BaseApp:packageAllyourBuildVariantNameClassesForMultiDex'
14:32:29.172 [LIFECYCLE] [class org.gradle.TaskExecutionLogger] :BaseApp:packageAllyourBuildVariantNameClassesForMultiDex FAILED'
In the case above, the aar file that I'd included in my libs directory (theOffendingAAR) included the Google Play Services jar (yes the whole thing. yes I know.) file whilst my BaseApp build file utilised location services:
compile 'com.google.android.gms:play-services-location:6.5.87'
You can safely remove the offending item from your build file(s), clean and rebuild (repeat if necessary).