He is blowing smoke regardless of whether the diverter is supposed to leak or not. If it is, it is because the manufacturer wanted to be sure that the standing water leaked out so the diverter would revert back to the tub side. That way, when the valve is turned on again, the user is not hit in the face with a slug of cold water. But, whether the leak is intentional or not depends on how it was made, and without a make and model we cannot decide that.