set

xAxis.Labels.SeriesLabels.Layout.Behavior = UseCollection

then access xAxis.Labels.SeriesLabels.BehaviorCollection, and add a Stagger behavior to that collection.  set EnableRollback = false and UseOnlyToPreventCollisions = false to force it to always stagger the labels.

it should be resolved in a future hotfix.  feel free to contact Infragistics Developer Support at any time to inquire about the status of this bug.  http://infragistics.com/gethelp

if you need a temporary workaround, try replacing the Stagger behavior you added with one of these:

    internal class MyStaggerBehavior : StaggerAxisLabelLayoutBehavior
    {
        public override bool Apply(Rectangle bounds, IAdvanceAxis axis, AxisAppearance axisApp, AxisLabelInfoCollection labels, out Rectangle boundsUsed)
        {
            for (int current = 0; current < labels.Count; current++)
            {
                if (current % 2 == 1)
                {
                    labels[current].TextPrimitive.bounds.Offset(0, 10);
                }
                SizeF labelSize = Infragistics.UltraChart.Core.Util.Platform.GetLabelSizePixels(labels[current].TextPrimitive.GetTextString(), labels[current].TextPrimitive.labelStyle);
                labels[current].TextPrimitive.bounds.Width = (int)Math.Ceiling(Math.Max(labelSize.Width, labels[current].TextPrimitive.bounds.Width));
            }
            boundsUsed = bounds;
            return true;
        }
    }