Tried testing the issue on Win-7 and win-10 using chrome reported version #64.0.3282.140 and latest canary #66.0.3346.0.
Attached a screencast for reference

Following are the steps followed to reproduce the issue.
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1. Opened the supplied standalone repro HTML
2. Clicked into the top text box, then click into bottom text box
3. Did not observe any entire text box border flashing at the cursor frequency as shown in the attached screencast at comment #0.
Note: Upon opening the html in IE or firefox, didn't observe any shadow highlighting around the text fields.

bobbitdiddle3@ - Could you please check the attached screen cast and please let us know if anything missed from our side. 

Thanks...!!

Deleted: 811951.mp4 723 KB

	811951.mp4 723 KB View Download

The sample HTML should generate shadow highlighting in IE11, but doesn't work in FF since it's using window.event which isn't allowed in FF.

As far as your trouble reproducing it, one problem is that you're moving around so fast you're not going to notice the problem.  The flash happens at the cursor rate or 1Hz, so after you click, or move the mouse, you need to wait a second or so to see whether the problem has started.

For me, the following always reproduces it:
#1 From outside the right of the top box, move in and click on it.  Wait at least a second or so after doing so.
#2 Now move the cursor into the bottom box and click, leaving the cursor inside that box.
For me, this always causes me to start seeing the border of the top box flash at the cursor rate, as is seen in the original video at around 0:14.

Thank you for providing more feedback. Adding requester "krajshree@chromium.org" to the cc list and removing "Needs-Feedback" label.

For more details visit https://www.chromium.org/issue-tracking/autotriage - Your friendly Sheriffbot

Able to reproduce the issue on mac 10.12.6, Win-10 and Ubuntu 14.04 using chrome reported version #64.0.3282.140 but the same is not reproducible in the latest canary #66.0.3347.0 and latest beta #65.0.3325.73.

Reverse Bisect Information:
=====================
Good build: 66.0.3338.0
Bad Build : 66.0.3336.0  

Change Log URL: 
https://chromium.googlesource.com/chromium/src/+log/0aac21e59b9ac9797e06435ad2409215e6e29692..5685d4cddd5a7e36bb837a483169a88971163208

From the above change log suspecting below change
Change-Id: I68c415de59162a29b642ad697e7b8ab8dc19f530
Reviewed-on: https://chromium-review.googlesource.com/900044

chrishtr@ - Could you please check and merge the fix to M-64 if it is a valid candidate.
Adding label RBS as it seems to be recent regression.

Thanks...!!

I can reproduce this on Windows but not Linux. 

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For more details visit https://www.chromium.org/issue-tracking/autotriage - Your friendly Sheriffbot

There are a lot of selection highlight bugs in your example but the specific one of another element flashing seems to have been fixed in the latest builds.

bobbitdiddle3, are you able to download Chrome Canary and see if this has been fixed?

Closing, seems to have been fixed.