I encountered the same issue and the following solution worked for me:

http://www.sqlteam.com/forums/topic.asp?TOPIC_ID=123808

USE [<database>];

GO

OPEN MASTER KEY

DECRYPTION BY PASSWORD = <password>;

ALTER MASTER KEY

DROP ENCRYPTION BY SERVICE MASTER KEY;

ALTER MASTER KEY

ADD ENCRYPTION BY SERVICE MASTER KEY;

CLOSE MASTER KEY;

GO