I'm pretty sure it's a general phone issue. Too many others have had this problem with the Nexus 4 regardless of OS or apparent specific app connection.
Mine is on KitKat 4.4.4 and the soft keys work ever so briefly when it's first woken up, then they go dead. EXCEPT... if I rotate it to landscape mode with the ear speaker to my right. (if to the left, or upright, they don't work).
Weird huh?