Problem still exists, also in v1.1.1.

Makes reporters disregard the status 'assigned' (or treat the issues as new / unassigned), as they cannot 'trust' the 'assigned'-status code.

If the issue isn't assigned to anyone (or; if an assignee is removed / issue is assigned to 'none' / blank), the correct status would be 'new', right? This should be validated & status set automatically.

The same also occurs when a previously assigned issue is "unassigned" (i.e. assigned to nobody).

In my opinion, Mantis should not allow status Assigned with no handler. I would suggest the following behavior:

• When editing an issue, check that handler is set before accepting the change
• When unassigning an issue, change status to New (actually, to whatever is defined for $g_bug_submit_status)

I did some dirty code hacks to change status into NEW when unassigned.
But this should be reviewed in core

Also, this request may be related: unassign when changing status to NEW 0005266