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def set_domain_password
  redirect_to :controller => 'home', :action => 'index_password' and return unless params['password'] = 'demoapplication'
  
  session[:passport] = 1
  redirect_to logged_in? ? {:controller => 'home', :action => 'index'} : {:controller => 'account', :action => 'login'}
end

Home controller

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def set_domain_password
  redirect_to PasswordValidator.query(params['password'], session)
end

In lib

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class PasswordValidator
  def self.query(password, session, logged_in)
    new(password, session, logged_in).validate
  end
  
  attr_reader :password, :session
  def initialize(password, session, logged_in)
    @password, @session, @logged_in = password, session, logged_in
  end
  
  def validate
    if password.matches?
      set_session
      handle_login
    else
      {:controller => 'home', :action => 'index_password'}
    end
  end
  
  private
  
    def handle_login
      if logged_in?
        {:controller => 'home', :action => 'index'}
      else
        {:controller => 'account', :action => 'login'}
      end
    end
    
    def logged_in?
      @logged_in
    end
  
    PASSWORD = 'demoapplication'
  
    def password_matches?
      password == PASSWORD
    end
  
    def set_session
      session[:passport] = 1
    end
    
end

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def set_domain_password
  unless demo_user?
    redirect_to index_password_url # What is index_password?
    return
  end
  
  set_demo_password
  redirect_to logged_in? ? home_url : login_url
end

def demo_user?
  params[:password] == "demoapplication"
end

def set_demo_password
  session[:passport] = 1
end