soundness issue with mutually-recursive type members

[scabug]

trait O { type A >: Any <: B; type B >: A <: Nothing }
val o = new O {}
def id(a: Any): Nothing = (a: o.B)
id("Boom")

[scabug]

Imported From: https://issues.scala-lang.org/browse/SI-9715?orig=1
Reporter: @namin
Affected Versions: 2.11.8, 2.12.0-RC1

[dwijnand]

3.0.0:

scala> trait O { type A >: Any <: B; type B >: A <: Nothing }
     | val o = new O {}
     | def id(a: Any): Nothing = (a: o.B)
     | id("Boom")
1 |trait O { type A >: Any <: B; type B >: A <: Nothing }
  |               ^
  |illegal cyclic type reference: upper bound O.this.B of type A refers back to the type itself
3 |def id(a: Any): Nothing = (a: o.B)
  |                           ^
  |                           Found:    (a : Any)
  |                           Required: o.B