Java 7 WatchService - The process cannot access the file because it is being used by another process

I followed the Watching a Directory for Changes Java7 nio2 tutorial to recursively monitor the entire contents of a directory using the code sample WatchDir.java.

The code looks like this:

// Get list of events for the watch key.
for (WatchEvent<?> event : key.pollEvents()) {
// This key is registered only for ENTRY_CREATE events, but an OVERFLOW event 
// can occur regardless if events are lost or discarded.
if (event.kind() == OVERFLOW) {
    continue;
}

// Context for directory entry event is the file name of entry.
@SuppressWarnings("unchecked")
WatchEvent<Path> ev = (WatchEvent<Path>)event;
Path fileName = ev.context();
Path fullPath = dir.resolve(fileName);

try {
    // Print out event.
    System.out.print("Processing file: " + fileName);

    processed = fileProcessor.processFile(fullPath);

    System.out.println("Processed = " + processed);

    if (processed) {
        // Print out event.
        System.out.println(" - Done!");
    }
} 
catch (FileNotFoundException e) {
    System.err.println("Error message: " + e.getMessage());
}
catch (IOException e) {
    System.err.println("Error processing file: " + fileName.toString());
    System.err.println("Error message: " + e.getMessage());
}

Ok, so the problem (where I am sure doing something stupid) is here:

processed = fileProcessor.processFile(fullPath);

And what it does is something like this:

public synchronized boolean processFile(Path fullPath) throws IOException {
String line;
String[] tokens;
String fileName = fullPath.getFileName().toString();
String fullPathFileName = fullPath.toString();

// Create the file.
File sourceFile = new File(fullPath.toString());

// If the file does not exist, print out an error message and return.
if (sourceFile.exists() == false) {
    System.err.println