A guy I know was in the same situation as you, but for a significantly larger sum, here's how he finally got paid.
Sue him for part of what he owes you, the max falling under small claims court. Then subpeona his employees who are relatvent to your case, to wit, call on each and every one of them to show up to court at some point. You need these witnesses to proceed with your rightful case, so what if just so happens to shut down his staff. If he's gonna play hardball and hide behind the legal process that he's betting you won't pay to pursue, you have to turn the tables on him.
True, can't win back the entire amount owed, but when he sees what you're doing to him, he'll be much more open to negotiating a payment. Small claims prefers that you end the matter in arbitration anyway, the hard part is getting him out there and then having him follow through on whatever agreement you can reach.
