The SCOTUS did no such thing. In People v. Diaz, the California Supreme Court held that warrantless searches of a cellphone was consistent with the protections of the U.S. Constitution and the CA State constitution. In other words, they interpreted a Police Procedure in light of State and Federal Constitutions. There was no statute involved.
In saying the SCOTUS 'let stand' that decision, this merely means that they chose not to grant certiorari. This is not affirming the decision, this is not striking down something similar, this is merely REFUSING to consider the question to begin with. There are numerous reasons the Court might do this: First, the issue involved a matter of State constitutional interpretation - a matter best left to individual states. This is because the California State Constitution recognizes more privacy protections than the U.S. Constitution. Second, the SCOTUS may be waiting for more opinions from other courts before they take on the issue. The search of cellphones is still relatively immature across the states and circuits. Third, alternately, the facts of Diaz may be unambiguous under federal protections, rendering intervention unnecessary.
OP is correct that Gov. Brown has this exactly backwards. A bill requiring heightened protections for cell phones does nothing to "overturn" the Cal. Sup. court's decision, as it does not change the way the court applies and interprets Constitutional protections. It instead, by legislative powers, creates a circumstance under which the State may provide more protections than the Constitution requires. This is explicitly and unambiguously allowed under the Tenth Amendment of the U.S. Constitution. A State may ALWAYS choose to provide more protections than the Constitution requires, it simply may not provide less.