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They have to show loss of earnings to claim damages in the UK, if they can't proove loss of earnings then they can't claim it.
Ask them why if they realised it was costing them 2K in damages they never contacted Nominet and followed their DRS procedure (I presume .co.uk's when you say 2 years ago).
Tell them they have not mitigated their losses as required by UK law on legal costs and have chosen a more expensive legal option when a simple and cost effective solution was available.
Then tell them to pee off
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