The output dataset already exists and cannot be overwritten.
Your settings may be preventing you from overwriting any data that already exists. If the output data already exists, geoprocessing tools either fail or delete the existing dataset and create a new one with the same name, based on the Overwrite the outputs of geoprocessing operations option.
If you want to overwrite the dataset, click the Geoprocessing menu and click Geoprocessing Options. Then enable Overwrite the outputs of geoprocessing operations. In a script, you can get the same behavior by adding this line: arcpy.env.overwriteOutput = True.