Go to Edit > Keyboard Shortcuts. In Product Area: Window Menu, check out the keyboard shortcut for Color: Color. If necessary delete a faulty keyboard shortcut.
If that doesn't work, try restoring your InDesign Preferences. Here's how:
Same problem, Steve's response DOES NOT fix. Only the up arrow key does not work!!!! Someone please help!!!
This worked for me:
Go to Edit > Keyboard Shortcuts > Window Menu > Color: Swatches
Change default key from F5 to something else. I used Opt-F5. You'll be asked to make another default preference file. Do that. The change should be immediate.