It seems fixed in trusty. Thanks.
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https://bugs.launchpad.net/bugs/1173312
Title:
screen : chmod /dev/pts/6: Operation not permitted
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On a 14.04 system, using your exact recipe, i was able to share the
screen. As raring is no longer support, please let us know if you still
have this issue on another release.
One thing which comes to mind is that perhaps you used 'su - user2'
instead of sshing to localhost as user2, before doing