Smog shop (friend of seller)disconnected "check engine" light to pass test. Stated by seller after the purchase was made. Transmission is bad
You can sue (or threaten to sue) the seller and the smog shop for fraud, since the DMV requires most cars to be sold with current smog checks. You can report the smog shop to the CA Air Resources Board and the Bureau of Automotive Repair, which oversees CA's Smog Check program.
As for the transmission, if this used car was sold "as is" without any warranty, you as buyer needed to determine, through your own mechanic's inspection, review of maintenance reciords, CarFax, etc., whether you wanted to assume the risks of it having defects such as a bad transmission BEFORE buying the car.
Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.