Mine does the same (Chrome+WinXP). Makes it incredibly hard to sit through when it's yelling Fail at me every time the counter gets to 1:57 regardless of me not actually doing anything. I only think I could sit through about 30 seconds of it flashing Fail until I left (tempted to debug, but too busy with work). I also briefly wondered if that was the test -- to sit through the buggy countdown clock without trying to troubleshoot why it's broken, if that's the test, I failed.

FYI, if I open the page in Chrome with cursor outside of the screen it counts down to 0, if my mouse is within the screen, it says Fail at about 1:57 continuously.

I've hooked up the resetCounter function to quite a few events, including "blur". Have you got another window that's stealing the focus regularly, such as an IM client or something?