.Xauthority.****** files polluting $Home

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Status changed to 'Confirmed' because the bug affects multiple users.

I can confirm this bug in 13.04. Also, the .Xauthority file is created with permissions of 0664 instead of the secure 0600.

Same trouble here.

Win7(Host) running VirtualBox 4.2.16
Linux Mint 14 Nadia Kernel 3.5.0-17-generic(i686) (Guest)(Yes, not Ubuntu, but based on same code)

Guest applications Geany(1.22), Pluma(1.4.0), and Gedit (2.30.4) cannot save to existing file.
Must create new file for each save on the Vbox shared folder. Other local(guest) folders work fine.

Did not start until Virtualbox updated to 4.2.16 no problems with setup before that.

Attempting to save an existing file with modifications results in files with names like (.goutputstream-0ZD71W) etc. and warnings that the file may have been truncated.

Two solutions I have found so far are:
1.) save-as a new file name each time I make a change. (terrible)
2.) open a terminal session in that folder and use nano or vi to edit text file. (no problems)

So it seems that the drive "mount" for the shared folder is ok as nano can edit files, but the "gui apps" have an issue.

It is basically the same issue in bug 984785 and should be fixed in lightdm 1.4.2, 1.6.1 and 1.7.1

This bug was fixed in the package lightdm - 1.6.0-0ubuntu3.1

---------------
lightdm (1.6.0-0ubuntu3.1) raring-security; urgency=low

  * SECURITY UPDATE: wrong permissions on .Xauthority file (LP: #1175023)
    - debian/patches/07_xauthority_perms.patch: use g_open instead of
      g_file_set_contents in src/xauthority.c.
    - debian/patches/08_xauthority_fix_perms.patch: fix incorrect
      permissions left behind by previous versions in src/xauthority.c.
    - CVE-2013-4331
 -- Marc Deslauriers <email address hidden> Thu, 12 Sep 2013 08:00:21 -0400

Unfortunately this still affects me after upgrading lightdm to 1.6.0-0ubuntu3.1

Still affected with lightdm 1.10.1 in Xubuhtu 14:4 (upgraded form 13:10).

@bryncoles: this bug is fixed. Are you sure those files are recent? what are the dates on them?