Basically we are running a nginx/apache2/django setup

memcached works, i tested it and such. From here it goes to apache server. Everything works right up till i enable the

set $memcached_key $uri;
memcached_pass 127.0.0.1:11212;


server {
listen 10.176.67.151:80;
server_name www.mysite.com;

location / {
proxy_pass http://10.176.67.151:8080/;
include /etc/nginx/proxy.conf;

set $memcached_key $uri;
memcached_pass 127.0.0.1:11212;


}
location /static/ {
alias /home/django/broadway.com/broadway/static/;
expires 1d;
}
location /media/ {
alias /home/django/broadway.com/src/django/django/contrib/admin/media/;
expires 1d;
}
}