High School Rule

What do you mean by "out of play"?  Are you referring to the foul/fair line?  A pop fly caught in foul territory is still an out. Doesn't matter where the defensive player caught the ball unless he was in an area deemed "out of play".

Sorry about confusion. Straddled "out of play" line. Not foul line. 

I went back and looked at the NFHS rule casebook I have on hand (2012, but I don't think this has changed...)

2.9.1 Situation C:

Umpires may use the following guidellines to determine the status of a fielder following the catch of a batted or thrown live ball: (1) It is a catch when he has one or both feet touching the playing field, or with both feet in flight prior to his touching any dead ball area. (2) If after making the catch both feet are entirely in a dead ball area, the ball becomes dead.

MLB rules are different:

Rule 5.09(a)(1) Comment

... A fielder, in order to make a catch on a foul ball nearing a dugout or other out-of-play area (such as the stands), must have one or both feet on or over the playing surface (including the lip of the dugout) and neither foot on the ground inside the dugout or in any other out-of-play area

So, in this case the umpire was correct.
    
   

Rob T - Thanks!  Seems odd, but definitely the right call according to the rules.