P: Folder layer color incorrectly applied to neighboring folder

[alsoalso]

I'm using Photoshop 23.3.1 on OS X 11.6.5

When making a new layer group that sits below an existing layer group (below, not inside of), if the above layer group has a label color the new layer group is also given that color, when I would expect it to get no color. 

How to reproduce error:

1. Open a new PS document.
2. Make a new, empty layer.
3. Place the layer in a layer group.
4. Set the layer group's color to something like Red.
5. Make a new layer below the group, but not inside it.
6. Now with new layer selected, place that new layer into a new group using either the right click menu or the command shortcut CMD+G. The new layer group will form under the previous group, but will also be colored red. If the right click menu is used, the dialogue will show red (or whatever color) selected as the default. This behavior does not seem to happen if you use the group button at the bottom of the panel.

[Jeffrey Tranberry]

Thanks for reporting. I can repro and will log an issue, but it looks like this behavior goes back to 20 years or more. I suspect the issue will be deferred.

[alsoalso]

Wow, I found a classic one. Thanks!