Legal Question in Criminal Law in California

They can demand anything but it is unlikely that they will force you to pay. The general advice is to ignore the threats.

It's not a civil "fine" - it's a civil demand letter. California law allows a merchant to demand up to $500 following a theft incident. These letters are typically sent by the store or a law firm acting on their behalf. They are all bark and no bite. If you ignore the letter, they have to make a choice - let it go or file a small claims case against you. I have never heard of anyone actually being sued if they ignore the letter. Why don't they do anything? Because lawyers cannot get involved in small claims cases and it isn't worth the store's time to pursue a small claims case over such a minor amount. There is one law firm in Florida that does nothing but these kind of civil demand letters on behalf of stores. They were quoted in a Wall Street Journal article as sending out over one and a half million letters a year, but they filed less than 10 lawsuits. Not ten percent. Not ten thousand. Ten. The odds are overwhelming that they won't do anything. If you choose to pay their demand, it just means they won't sue you, but it will have no impact on any criminal prosecution. Paying it won't stop criminal charges from being filed and not paying it won't make a criminal case worse or cause charges to be filed if they weren't going to be in the first place.

So yes - they can "demand", but...

Sure, and they can file criminal charges whether you pay them or not.