I found the issue and the fix. I leverage caddy sidecar image. The container was created with
image: caddy:latest
This pulls from the docker registry not my azure container registry. With the changes made by docker on 6/30/2024, the pull from the docker registry was failing.
The solution was to pull caddy from docker registry and then stage and push the image to my azure container registry and update the container definition to pull from my azure container registry instead of docker. Basically changing the reference
image: [myacr].azurecr.io/caddy:latest
That solved it.