Yes, Tenants do have rights. Here in L.A.,. there are showing restrictions. There are designated times during the day to show the tenants unit to prospective buyers. And obviously, tenants must be given 24 hour notice.
In your situation, the Tenant is ignoring the fact that the Seller is still the Owner in this Short Sale Listing.
I like the comments of Jon Griffith...Showing a tenants unit for sale is covered by law in the Landlord Tenant Act.
Consult a real estate eviction attorney...Good luck.