Failed to connect. Is docker running?

[prkaaviya]

Type: Bug

I'm able to docker switch context from my MacOS terminal and view the running containers but the same docker context switch in vscode is saying Failed to connect. Is Docker running?

Extension version: 1.22.1
VS Code version: Code 1.70.2 (Universal) (e4503b30fc78200f846c62cf8091b76ff5547662, 2022-08-16T05:36:37.829Z)
OS version: Darwin x64 21.5.0
Modes:

System Info

Item	Value
CPUs	Intel(R) Core(TM) i7-9750H CPU @ 2.60GHz (12 x 2600)
GPU Status	2d_canvas: enabled canvas_oop_rasterization: disabled_off direct_rendering_display_compositor: disabled_off_ok gpu_compositing: enabled metal: disabled_off multiple_raster_threads: enabled_on opengl: enabled_on rasterization: enabled raw_draw: disabled_off_ok skia_renderer: enabled_on video_decode: enabled video_encode: enabled webgl: enabled webgl2: enabled
Load (avg)	3, 3, 3
Memory (System)	16.00GB (0.02GB free)
Process Argv	--crash-reporter-id 640900b9-e1ca-4b19-9564-de5bd4cf8ad8
Screen Reader	no
VM	0%

A/B Experiments

vsliv368cf:30146710
vsreu685:30147344
python383:30185418
vspor879:30202332
vspor708:30202333
vspor363:30204092
vswsl492cf:30256860
vslsvsres303:30308271
pythonvspyl392:30443607
vserr242:30382549
pythontb:30283811
vsjup518:30340749
pythonptprofiler:30281270
vshan820:30294714
vstes263:30335439
vscorecescf:30445987
pythondataviewer:30285071
vscod805cf:30301675
binariesv615:30325510
bridge0708:30335490
bridge0723:30353136
cmake_vspar411:30542924
vsaa593cf:30376535
pythonvs932:30410667
wslgetstarted:30449410
cppdebug:30492333
pylanb8912:30545647
vsclangdc:30486549
c4g48928:30535728
d7fjc500:30543455
dsvsc012cf:30540253
azure-dev_surveyone:30548225

[bwateratmsft]

This should be solved by #3586. I'll resolve this as a dupe of #3263 for now.