It's nearly certain they shouldn't have been there (although in some states I hear policemen have told cyclists to stick to the sidewalk - a stupid idea but anyway).

However, I'm certain they had right of way, like a pedestrian would have. (They were probably going about the speed of a fast runner.)

This is even more true if you were coming out of a parking lot (private driveway) without a light to give you priority and or a stop for them (you have a stop by default coming out of any driveway). Moreoever, usually, slower vehicles (and pedestrians) are thought to have right of way.

So, yeah, they were not in the right spot. And it's fairly unlikely that policepeople would have ticketed you for that, because they don't care much about pedestrians and cyclists usually. But when I move around with a ton and a half of metal around me, I always prefer to err on the side of caution...