It shouldn't have anything todo with the template.
It generally happens when your products have 's in the name.
try replacing your cart_alert.tpl with the following (strips out any ' from the product for the alert)
{if $main eq "product"}
{literal}
<script type="text/javascript">
function Cart_Alert_Product_{/literal}{$product.productid}{literal}() {
Shadowbox.open({player:"html",content:'<div class="alert_msg"><div class="links"><a href="cart.php"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart.png" />{/literal}{$lng.lbl_cart_alert_view}{literal}</a></div><div class="links"><a href="{/literal}{$stored_navigation_script}{literal}" onclick="Shadowbox.close();return false"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart_put.png" />{/literal}{$lng.lbl_cart_alert_continue}{literal}</a></div><div class="links"><a href="cart.php?mode=checkout"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart_go.png" />{/literal}{$lng.lbl_cart_alert_checkout}{literal}</a></div><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/tick.png" />{/literal}{$lng.lbl_cart_alert_added}{literal}<h2>{/literal}{$product.product|replace:'\'':''}{literal }</h2><p>{/literal}<a href="#" onclick="Shadowbox.close();">{include file="product_thumbnail.tpl" productid=$product.image_id image_y=125 product=$product.product|escape tmbn_url=$product.image_url id="product_thumbnail" type=$product.image_type}</a>{literal}</p><p>{/literal}{$lng.lbl_cart_alert_to_cart}{literal}</p><hr /><h3>{/literal}{$lng.lbl_cart_alert_also}{literal}</h3>{/literal}{if $product_links}{section name=product loop=$product_links max=3}<div class="upsell"><a href="product.php?productid={$product_links[product].productid}">{include file="product_thumbnail.tpl" productid=$product_links[product].productid product=$product_links[product].product tmbn_url=$product_links[product].tmbn_url image_y=75}</a><br />{$product_links[product].product|escape:"html"}</div>{/section}{else}{section name=product loop=$recommends max=3}<div class="upsell"><a href="product.php?productid={$recommends[product].productid}">{include file="product_thumbnail.tpl" productid=$recommends[product].productid product=$recommends[product].product tmbn_url=$recommends[product].tmbn_url image_y=75}</a><br />{$recommends[product].product|escape:"html"}</div>{/section}{/if}{literal}<div class="clearing"></div>',height:420,width:600});}
Shadowbox.init();
</script>
{/literal}
{elseif $main eq "search" || $main eq "products" || $main eq "catalog"}
{foreach from=$products item=product name=products}
{literal}
<script type="text/javascript">
function Cart_Alert_Product_{/literal}{$product.productid}{literal}() {
Shadowbox.open({player:"html",content:'<div class="alert_msg"><div class="links"><a href="cart.php"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart.png" />{/literal}{$lng.lbl_cart_alert_view}{literal}</a></div><div class="links"><a href="{/literal}{$stored_navigation_script}{literal}" onclick="Shadowbox.close();return false"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart_put.png" />{/literal}{$lng.lbl_cart_alert_continue}{literal}</a></div><div class="links"><a href="cart.php?mode=checkout"><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/cart_go.png" />{/literal}{$lng.lbl_cart_alert_checkout}{literal}</a></div><img class="icon" src="{/literal}{$SkinDir}{literal}/modules/Cart_Alert/images/tick.png" />{/literal}{$lng.lbl_cart_alert_added}{literal}<h2>{/literal}{$product.product|replace:'\'':''}{literal }</h2><p>{/literal}<a href="#" onclick="Shadowbox.close();"><img src="image.php?id={$product.productid}&type=T" /></a>{literal}</p><p>{/literal}{$lng.lbl_cart_alert_to_cart}{literal}</p><hr /><h3>{/literal}{$lng.lbl_cart_alert_also}{literal}</h3>{/literal}{section name=product loop=$products max=3}<div class="upsell"><a href="product.php?productid={$products[product].productid}">{include file="product_thumbnail.tpl" productid=$products[product].productid product=$products[product].product tmbn_url=$products[product].tmbn_url image_y=75}</a><br />{$products[product].product|escape:"html"}</div>{/section}{literal}<div class="clearing"></div></div>',height:420,width:600});}
Shadowbox.init();
</script>
{/literal}
{/foreach}
{/if}