California small claims limit is $10,000, the price of your flooring. You can file two cases per year over $2500.
Sue both in small claims, they'll come around and figure it out.
The installer is at fault when he realized the product was wrong and went to the store, they should have notified you and stopped installation.
The vendor, LM Flooring, will need to confirm why their product is defective. IMHO, it's pretty obvious that the boxes were mislabeled.