I would tell them to go suck a cock. I was managing few domains for my boss (Rick Latona) when we recieved a email from a certain company(which will remain nameless) They tried to threaten us with their legal representation. Rick told them to kiss his ass he's got lawyers as well. That was over a year ago. They have never called, emailed, or mailed the office.
P.S. in short tell them to FUCK OFF
They are trying to scare you.