Title is self-explanatory. If you need some more information, just ask me, I'll provide more. I also put screenshots of the bug.
EDIT #1: Steps to reproduce as requested by redstonehelper:
Path 1 (If you have anyone in your LAN network):
1. Open a world to LAN.
2. Invite someone to join your world.
3. Tell your friend to wear a pumpkin on his head.
4. Tell your friend to look around a bit, horizontally and vertically.
5. Observe the pumpkin only moving vertically and staying at the same horizontal direction.
Path 2 (If you don't have anyone in your LAN network):
1. Open a world with an offline account (Offline accounts are most easily used with MagicLauncher) to LAN.
2. Open the official Minecraft launcher and get your premium account on.
3. Get your premium account to join the LAN world.
4. All steps next are steps 3-5 in path 1, with your friend as your offline account (Or premium, doesn't matter) and observing from the other account.