Died after the fact in Crux of Nothingness

Friends and I completed Crux of Nothingness, Ingenuity drops. I was dead from the the OHKO after he died. Loot drops but friends cant pick up belt even though its on short allocation. I respawn and all loot disappears except for the skill book. Is this how it's supposed to work?

Same thing just happend to a friend and i, i died but my friend killed the boss, a divine orb and some other good stuff dropped for me, but my friend couldnt loot anything, when i clicked resurrect, both of us respawned and the loot was gone, but the skill book dropped for me only :/

If there is this kind of "penalty" when playing with friends in this game, i guess solo play is the way to go :<