Your next step should be the Riverside County Court, IMO. I'm in AZ, so Cali is a totally different realm than I'm used to, but here, civil suit filing fee's are like $35 depending on county, and generally that alone, once the defendant(s) are served, solves the issue. No lawyers involved. (Well, theirs maybe).
Cali I don't know. The "Screwinator" has no doubt even influxed the debacle you call an economy by making sure that the "Golden" State's highest percentage percapita (of ANYWHERE) lawyers get theirs. Again, just my observation.
Another solution might be, kinda bold but, I know here a couple TV stations get OFF on going after businesses like this with an investigative reporter and chit (they keep a running total on what they reclaim for people, even put a few people in prison and more than that out of business). Might be worth a couple phone calls, and the publicity, or threat therof, might garner results.
Gawd I'm glad I'm such nice guy! I feel like I'm pennies from heaven for this kinda thing, but just deal with it on my own when it happens to me, lol. No wonder I may have an Ulcer!
Ray