I've never played this rule in 8ball, we don't have that rule in here where I live, or even in big 8ball tournaments that I've seen, this rule is new to me, but here's the thing to focus on when playing pool.
Rules can be changed and redesigned for each tournament, this is usually the case in every tournament and I've seen this happen for many many years in every country. It's not a new thing, it's been in pool for decades now.
Usually tournament director and tournament creator can change few tiny rules here and there in every game, but he should have those set of rules written somewhere.
Lets be honest, in pool there isn't ONE RULE FOR THE WHOLE WORLD, because you can see few tiny changes here and there from country to other, from tournament to other. as I said in previous paragraph, usually TD & the guy who made the tournament will say the rules.
Sometimes you can find 9ball tournament, where TD tells you in the start of tournament, 9ball on spot for breaking, touching balls is foul, or touching balls is not foul, or if you break and made the cueball with balls, all balls spot, or not, then on 10ball you can find so many different rules that can be played, depends on guy who made the tournament.
Anyway the point i'm trying to make here, is i've never personally played that rule, but if the TD says it is the rule of that particular tournament, then yes, you lost the match, but sorry that you didn't know or ask about the rules prior to playing in that tournament.
But if they lied to you and it wasn't a real rule, then sorry that it happened to you and these guys are jerks.