scottpt, I hate to be picky . . .
1.) char(34) is a " . . . I think you meant char(9) for TAB . . .
2.) this iterative method is going to be quite slow going through a table with 400,000 rows. You will have to populate @note (which you have as a varchar(255), when the poster said it was a varchar(500)) with each record, one at a time. This simply won't scale well . . .
A much more 'SQLicious' approach would be...
set description = replace(description,char(9),'')