Wait until Cesar calls on your cell phone and tells you that the Yay or courier is leaving San Fierro and that they are on bikes. To fight with a cell phone in your hand, press Y to hang up while he is talking to you. Then, immediately aim at a pedestrian with your fists as a weapon. Your cell phone should still be in your hand. You will be able to hit people with the cell phone. If you change weapons, it will disable this effect.