Would you be able to try this with another display manager, e.g. gdm?

Can you see what $PATH is set to when logging in on a terminal? It looks
at first glance like the session can't find upstart, and that can't find
the session processes to run.

** Changed in: lightdm (Ubuntu)
       Status: New => Incomplete

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https://bugs.launchpad.net/bugs/1228079

Title:
  Login issue: Lightdm + LDAP + Kerberos

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