Which JDBC drivers are you using with sql server? It's most likely a config issue at the JDBC driver. Either the driver needs to provide the login information when it creates the db connection, or it needs to be able to create 'trusted connections' to the db server.
I seem to remember something vaguely similar from couple of years back when trying to work JDBC with MS SQL server but can't remember the details very well.
make sure your server is set up to accept sql server authentication as well as windows authentication. the error you are gettting is a windown auth error