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For clarification (in case anyone dredges this up with the search engine) the problem is prevalent with just about all the SU/RunAs commands.
When you call the command from a UNC path during login or a similar process the command objects to not running in a valid local directory. This can also happen when the current directory becomes invalid due to the change in credentials (permissions)
The simple solution is to change to a local drive and directory which is valid for both the old and new credentials before calling the command.
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