Quote Quoting Taxing Matters
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I don't see that you committed extortion from your description, but then I didn't see exactly what you wrote, either. While responding to them to say that you owe them nothing is fine (though I would have just ignored them until they actually sued, which they might never do), going beyond that to assert to one of the company investors that the company violated the law risks a potential action for defamation and threatening the company with legal action for matters unrelated to the demand the company has made can often be counter productive. If you want them to just go away, angering them over unrelated matters is, in my experience, not helpful.
Ditto...it would be far more sensible to ignore them. However, if you cannot seem to manage that then having an attorney draft a response would be far more sensible than doing it yourself.