diff -Naur --exclude='*orig' psi-0.10-test3-orig/src/contactview.cpp psi-0.10-test3/src/contactview.cpp
--- psi-0.10-test3-orig/src/contactview.cpp	2005-11-08 22:16:14.000000000 +0000
+++ psi-0.10-test3/src/contactview.cpp	2005-11-08 22:19:44.000000000 +0000
@@ -1244,7 +1244,7 @@
 						str += QString("%1. %2").arg(n+1).arg(*it);
 						gm->insertItem(str, n+base_group);
 
-						if(*it == g)
+						if(u->inGroup(*it))
 							gm->setItemChecked(n+base_group, true);
 						++n;
 					}
@@ -1370,8 +1370,9 @@
 			if(online) {
 				// if we have groups, but we are setting to 'none', then remove that particular group
 				if(!u->groups().isEmpty()) {
-					QString gname = groupNameCache;
-					actionGroupRemove(u->jid(), gname);
+					for(QStringList::ConstIterator it = gl.begin(); it != gl.end(); ++it) {
+						actionGroupRemove(u->jid(), *it);
+					}
 				}
 			}
 		}
@@ -1386,17 +1387,7 @@
 						continue;
 
 					// make sure we don't have it already
-					bool found = false;
-					const QStringList &groups = u->groups();
-					for(QStringList::ConstIterator it = groups.begin(); it != groups.end(); ++it) {
-						if(*it == newgroup) {
-							found = true;
-							break;
-						}
-					}
-					if(!found) {
-						QString gname = groupNameCache;
-						actionGroupRemove(u->jid(), gname);
+					if (!u->inGroup(newgroup)) {
 						actionGroupAdd(u->jid(), newgroup);
 						break;
 					}
@@ -1518,16 +1509,40 @@
 					++n;
 				}
 
-				if(newgroup.isEmpty())
+				if(newgroup.isEmpty()) {
 					newgroup = ContactView::tr("Hidden");
+					if (!u->inGroup(newgroup)) {
+						// clicking on 'hidden' when it wasn't previously
+						// selected will deselect all groups
+						for(QStringList::ConstIterator it = gl.begin(); it != gl.end(); ++it) {
+							actionGroupRemove(u->jid(), *it);
+						}
+					}
+					// if hidden group was already selected, it'll
+					// be deselected only if contact is in other
+					// groups too
+				}
+				else
+				{
+					// a specific group was selected; make sure
+					// this contact isn't in the 'hidden' group.
+					QString h = ContactView::tr("Hidden");
+					if (u->inGroup(h))
+					{
+						actionGroupRemove(u->jid(), h);
+					}
+				}
 
-				if(n == n2) {
-					// remove the group of this cvi if there is one
-					if(!u->groups().isEmpty()) {
-						//QString gname = ((ContactViewItem *)static_cast<QListViewItem *>(i)->parent())->groupName();
-						QString gname = groupNameCache;
-						actionGroupRemove(u->jid(), gname);
+				if (u->inGroup(newgroup))
+				{
+					// we're already in this group.  If contact is
+					// in multiple groups, remove it.
+					if (u->groups().count() > 1) {
+						actionGroupRemove(u->jid(), newgroup);
 					}
+				}
+				else
+				{
 					// add the group
 					actionGroupAdd(u->jid(), newgroup);
 				}
@@ -1697,7 +1712,7 @@
 	}
 }
 
-void ContactProfile::dragDrop(const Jid &jid, ContactViewItem *i)
+void ContactProfile::dragDrop(const Jid &jid, ContactViewItem *i, ContactViewItem *o = 0)
 {
 	if(!d->pa->loggedIn())
 		return;
@@ -1720,20 +1735,27 @@
 	// already in the general group
 	if(gr->groupType() == ContactViewItem::gGeneral && gl.isEmpty())
 		return;
-	// already in this user group
-	if(gr->groupType() == ContactViewItem::gUser && u.inGroup(gr->groupName()))
+
+	if(gr->groupType() != ContactViewItem::gUser)
 		return;
 
-	//printf("putting [%s] into group [%s]\n", u.jid().full().latin1(), gr->groupName().latin1());
+	if (o) {
+		Jid j = o->u()->jid();
+		// o really can't be a group
+		if (o->type() != ContactViewItem::Group)
+			o = (ContactViewItem *) (static_cast<QListViewItem *>(o)->parent());
 
-	// remove all other groups from this contact
-	for(QStringList::ConstIterator it = gl.begin(); it != gl.end(); ++it) {
-		actionGroupRemove(u.jid(), *it);
+		if(gr->groupName() == o->groupName())
+			return;
+
+		if (o) {
+			actionGroupRemove(j, o->groupName());
+		}
 	}
-	if(gr->groupType() == ContactViewItem::gUser) {
-		// add the new group
+
+	// add the new group
+	if(!u.inGroup(gr->groupName()))
 		actionGroupAdd(u.jid(), gr->groupName());
-	}
 }
 
 void ContactProfile::dragDropFiles(const QStringList &files, ContactViewItem *i)
@@ -3460,6 +3482,13 @@
 	// if(!QTextDrag::decode(m, str))
 	// 	return false;
 
+	if (QDropEvent* e = const_cast<QDropEvent*>((const QDropEvent*)(m)))
+	{
+		QDropEvent::Action a = e->action();
+		if ((a == QDropEvent::Copy) || (a == QDropEvent::Move))
+			e->acceptAction();
+	}
+
 	return true;
 }
 
@@ -3509,6 +3538,22 @@
 		if(JidDrag::decode(i, jids)) {
 			for_each(jids.begin(), jids.end(), DroppedJidFunk(this));
 		}
+
+		QString text;
+		if (QTextDrag::decode(i, text)) {
+			ContactViewItem* old = 0;
+
+			if (i->action() == QDropEvent::Move) {
+				if (QListView* src = dynamic_cast<QListView*>(i->source())) {
+					old = (ContactViewItem*)(src->selectedItem());
+					i->acceptAction();
+				}
+			}
+
+			i->accept();
+
+			d->cp->dragDrop(text, this, old);
+		}
 	}
 }
 
diff -Naur --exclude='*orig' psi-0.10-test3-orig/src/contactview.h psi-0.10-test3/src/contactview.h
--- psi-0.10-test3-orig/src/contactview.h	2005-11-08 22:16:14.000000000 +0000
+++ psi-0.10-test3/src/contactview.h	2005-11-08 22:19:44.000000000 +0000
@@ -173,7 +173,7 @@
 
 	friend class ContactViewItem;
 	friend class DroppedJidFunk;
-	void dragDrop(const Jid &, ContactViewItem *);
+	void dragDrop(const Jid &, ContactViewItem *, ContactViewItem *);
 	void dragDropFiles(const QStringList &, ContactViewItem *);
 };