diff --git a/packages/dialog/src/library/schemaMerger.ts b/packages/dialog/src/library/schemaMerger.ts
index 6cd7418c2..0934ea1c2 100644
--- a/packages/dialog/src/library/schemaMerger.ts
+++ b/packages/dialog/src/library/schemaMerger.ts
@@ -1424,6 +1424,7 @@ export class SchemaMerger {
         for (const [ext, files] of this.files.entries()) {
             for (const [file, records] of files.entries()) {
                 const winner = records[0]
+                let winnerSrc = ''
                 const same: PathComponent[] = []
                 const conflicts: PathComponent[] = []
                 for (const alt of records) {
@@ -1431,18 +1432,24 @@ export class SchemaMerger {
                         alt.node.metadata.includesSchema = true
                     }
                     if (alt !== winner) {
-                        if (winner.node === alt.node) {
-                            same.push(alt)
-                        } else if (ext === '.schema') {
-                            // Check for same content which can happen when project and nuget from project are 
-                            // both being used.
-                            const winnerSrc = await fs.readFile(winner.path, 'utf8')
-                            const altSrc = await fs.readFile(alt.path, 'utf8')
-                            if (winnerSrc !== altSrc) {
+                        if (!winnerSrc) {
+                            winnerSrc = await fs.readFile(winner.path, 'utf8')
+                        }
+                        const altSrc = await fs.readFile(alt.path, 'utf8')
+                        // If content is identical, then don't treat as a duplicate.
+                        // This is mainly about nuget packages which like to have multiple copies of files.
+                        if (winnerSrc !== altSrc) {
+                            if (winner.node === alt.node) {
+                                same.push(alt)
+                            } else if (ext === '.schema') {
+                                const winnerSrc = await fs.readFile(winner.path, 'utf8')
+                                const altSrc = await fs.readFile(alt.path, 'utf8')
+                                if (winnerSrc !== altSrc) {
+                                    conflicts.push(alt)
+                                }
+                            } else if (ext !== '.uischema') {
                                 conflicts.push(alt)
                             }
-                        } else if (ext !== '.uischema') {
-                            conflicts.push(alt)
                         }
                     }
                 }
diff --git a/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.schema b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.schema
new file mode 100644
index 000000000..95fb1d9a2
--- /dev/null
+++ b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.schema
@@ -0,0 +1,65 @@
+{
+    "$schema": "https://schemas.botframework.com/schemas/component/v1.0/component.schema",
+    "$role": "implements(Microsoft.IDialog)",
+    "title": "Adaptive Dialog",
+    "description": "Flexible, data driven dialog that can adapt to the conversation.",
+    "type": "object",
+    "properties": {
+        "id": {
+            "type": "string",
+            "title": "Id",
+            "description": "Optional dialog ID."
+        },
+        "autoEndDialog": {
+            "$ref": "schema:#/definitions/booleanExpression",
+            "title": "Auto end dialog",
+            "description": "If set to true the dialog will automatically end when there are no further actions.  If set to false, remember to manually end the dialog using EndDialog action.",
+            "default": true
+        },
+        "defaultResultProperty": {
+            "type": "string",
+            "title": "Default result property",
+            "description": "Value that will be passed back to the parent dialog.",
+            "default": "dialog.result"
+        },
+        "recognizer": {
+            "$kind": "Microsoft.IRecognizer",
+            "title": "Recognizer",
+            "description": "Input recognizer that interprets user input into intent and entities."
+        },
+        "generator": {
+            "$kind": "Microsoft.ILanguageGenerator",
+            "title": "Language Generator",
+            "description": "Language generator that generates bot responses."
+        },
+        "selector": {
+            "$kind": "Microsoft.ITriggerSelector",
+            "title": "Selector",
+            "description": "Policy to determine which trigger is executed. Defaults to a 'best match' selector (optional)."
+        },
+        "triggers": {
+            "type": "array",
+            "description": "List of triggers defined for this dialog.",
+            "title": "Triggers",
+            "items": {
+                "$kind": "Microsoft.ITrigger",
+                "title": "Event triggers",
+                "description": "Event triggers for handling events."
+            }
+        },
+        "schema": {
+            "title": "Schema",
+            "description": "Schema to fill in.",
+            "anyOf": [
+                {
+                    "$ref": "http://json-schema.org/draft-07/schema#"
+                },
+                {
+                    "type": "string",
+                    "title": "Reference to JSON schema",
+                    "description": "Reference to JSON schema .dialog file."
+                }
+            ]
+        }
+    }
+}
diff --git a/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.uischema b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.uischema
new file mode 100644
index 000000000..37553d142
--- /dev/null
+++ b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/Microsoft.AdaptiveDialog.uischema
@@ -0,0 +1,24 @@
+{
+    "$schema": "https://schemas.botframework.com/schemas/ui/v1.0/ui.schema",
+    "form": {
+        "label": "Adaptive dialog",
+        "description": "This configures a data driven dialog via a collection of events and actions.",
+        "helpLink": "https://aka.ms/bf-composer-docs-dialog",
+        "order": [
+            "recognizer",
+            "*"
+        ],
+        "hidden": [
+            "triggers",
+            "generator",
+            "selector",
+            "schema"
+        ],
+        "properties": {
+            "recognizer": {
+                "label": "Language Understanding",
+                "description": "To understand what the user says, your dialog needs a \"Recognizer\"; that includes example words and sentences that users may use."
+            }
+        }
+    }
+}
diff --git a/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.jpg b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.jpg
new file mode 100644
index 000000000..ebc43fd72
--- /dev/null
+++ b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.jpg
@@ -0,0 +1 @@
+picture
\ No newline at end of file
diff --git a/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lg b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lg
new file mode 100644
index 000000000..d2ce1d909
--- /dev/null
+++ b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lg
@@ -0,0 +1,2 @@
+# template
+- template
\ No newline at end of file
diff --git a/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lu b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lu
new file mode 100644
index 000000000..e7b263a4b
--- /dev/null
+++ b/packages/dialog/test/commands/dialog/nuget/nuget3/1.0.0/duplicated/nuget3.lu
@@ -0,0 +1,2 @@
+# intent
+- intent
\ No newline at end of file
diff --git a/packages/dialog/test/commands/dialog/projects/project2/multiple.dialog b/packages/dialog/test/commands/dialog/projects/project2/multiple.dialog
index e69de29bb..9e26dfeeb 100644
--- a/packages/dialog/test/commands/dialog/projects/project2/multiple.dialog
+++ b/packages/dialog/test/commands/dialog/projects/project2/multiple.dialog
@@ -0,0 +1 @@
+{}
\ No newline at end of file