I got this error for the first time today, while trying to get a query working in ColdFusion 8.01. I'd defined some custom functions in SQL Server, and tested them out through the SQL Server Management Studio, but the datasource user didn't have the right permissions to use the queries. I added the permissions, reloaded the page and got smacked with the following error:
I found the solution on House of Fusion: restart your ColdFusion services. Something about the lack of permissions seems to catch in CF, and wont be released until you restart.