It is actually on page 58 of the Calif DMV Driver's Handbook. http://dmv.ca.gov/pubs/dl600.pdf
"Solid Green. A green
light means “GO” but
first give the right of
way to any vehicle, bicyclist, or
pedestrian in the intersection."
I guess that means you have to wait for someone coming from the opposite direction to run the red light and turn left in front of you.
I see the point in waiting until the intersection is clear before proceeding. There could be a little old lady who began crossing the street legally but ran out of time, or perhaps a vehicle is grid-locked and can't move out of the way.
Nonetheless, the cop should not have said the other driver was in the intersection legally since he ran the red light.
Good luck. I hope this helps.