Ok, I think I may have clue. You're using lxcfs in version 2.0.4. This
version of lxcfs does not handle uninitialized cpuset hierarchies
which can happen when systemd does not allocate a per-user cgroup in
the cpuset controller. I fixed this in lxcfs 2.0.5 by reimplementing
the cgroup handling code in the pam module that is shipped with it.
I'm not sure whether Stéphane has backported lxcfs 2.0.5 to 16.04. In
case he hasn't, you can grab lxcfs 2.0.5 from our stable ppa:

sudo add-apt-repository ppa:ubuntu-lxc/lxcfs-stable
sudo apt-get update

and then install lxcfs + libpam-cgfs, reboot and you should be good to
go. Please report back whether this worked. If it doesn't, please
attach the same information I requested before again, so I can debug.
:)

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Touch seeded packages, which is subscribed to lxc in Ubuntu.
https://bugs.launchpad.net/bugs/1649582

Title:
  lxc-start fails to start a unprivileged container  - cgroup
  permissions

Status in lxc package in Ubuntu:
  New

Bug description:
  I was following this simple getting start tutorial:

  https://linuxcontainers.org/lxc/getting-started/

  Created using:

  lxc-create -t download -n ci -- -d ubuntu -r trusty -a amd64

  But it always fails at:

  lxc-start -n ci -d

  I even tried another Ubuntu 14.04 but didn't work too for same
  problem.

  Below the debug log got from running `lxc-start`

  ProblemType: Bug
  DistroRelease: Ubuntu 16.04
  Package: lxc 2.0.5-0ubuntu1~ubuntu16.04.3
  ProcVersionSignature: Ubuntu 4.4.0-53.74-generic 4.4.30
  Uname: Linux 4.4.0-53-generic x86_64
  NonfreeKernelModules: nvidia_uvm nvidia
  ApportVersion: 2.20.1-0ubuntu2.2
  Architecture: amd64
  CurrentDesktop: XFCE
  Date: Tue Dec 13 14:05:44 2016
  InstallationDate: Installed on 2016-07-09 (156 days ago)
  InstallationMedia: Xubuntu 16.04 LTS "Xenial Xerus" - Release amd64 
(20160420.1)
  PackageArchitecture: all
  SourcePackage: lxc
  UpgradeStatus: No upgrade log present (probably fresh install)
  defaults.conf:
   lxc.network.type = veth
   lxc.network.link = lxcbr0
   lxc.network.flags = up
   lxc.network.hwaddr = 00:16:3e:xx:xx:xx

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