Comment #18 on issue 1629 by [email protected]: HTTP BASIC and DIGEST  
Authentication not passed once login takes place
http://code.google.com/p/chromium/issues/detail?id=1629

This is a bug in how chromium applies Set-Cookie received by a 401 response.

I have opened a new bug for this logoff issue:

http://code.google.com/p/chromium/issues/detail?id=6450

So please go ahead and start that one for updates.

You can also break out of the loop by hitting "Cancel", and then attempt  
again.
Still sucks, but marginally better than restarting the browser.
The reason is the "sessionid=signedoff" will actually be cleared once you  
hit "Cancel".

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