According to Markus Kuhn, this bug has been fixed with the screen
version in Ubuntu 16.04. Hence closing.

Future versions of screen (4.5.1-1 and higher, currently in Debian
Experimental) use libutempter instead of setgid utmp and hence
/var/run/screen/ will have permissions 1777 anyways.

** Changed in: screen (Ubuntu)
       Status: Confirmed => Fix Released

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https://bugs.launchpad.net/bugs/1380080

Title:
  Cannot make directory '/var/run/screen': Permission denied (convert
  init to upstart)

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