The underlying provider failed on Open is an entity framework error and with a simple fix it is little difficult to sort out what is going wrong.
1) if you are using IIS 7 with Integrated Security in connection string. Make sure your IIS user have appropriate permissions to access database.
2) If you are using Visual Studio built in Web Server and facing this issue. Simple fix is to either re-start Visual Studio or Kill the process of Web Server which is (WebDev.WebServer*.exe).
I was in the second case and killing the process of Web Server did the job for me.