If this was me, I would either:
A:
Do nothing and WAIT until they have spent a lot of time and money
on creating a case which has no merit (see below) because if they
were smart they would have BOUGHT from your site and the second
you put it int he mail, you would be on your way to jail for Mail Fraud.
Criminal charge - supercedes any an all civil remedies available to them.
However, they don't seem to be smart - they obviously did not buy
a DVD from your site, or they'd KNOW you are an Amazon affiliate
AND they did not mention the surrendering of your domain name
nor offer to just buy the site.
B:
Write them and explain that you are simply directing traffic as an affliate
to ensure their fine, first generation products are sold through a reputable
point of sale; Amazon.com and that by your estimation, if all affiliate efforts
were to stop under duress, that would be be a restraint of trade matter.
C: The smart-ass approach.
Hi. Got your letter. Laughed my ass off.
Do you know who is the top Amazon.com affiliate for your products listed there
and who drives all the sales traffic to Amazon.com? Do you know the reason
behind your success through Amazon.com ??? Maybe you should first figure
how much of your yearly income is derived from Amazon.com sales and work
backwards from there to really understand the ramifications of stopping me!
You obviously did not buy a product through my site or you would
see that you are making false claims. All the products are sold
through Amazon.com There is no way to be confused about this
if you had simply tried to buy one - you'd be on the Amazon.com site.
Can you imagine what would go through a judges mind if he were
to duplicate and verify my statement against your false claims?
HE WOULD ADVISE YOU TO READ "Chicken Little"
Because the products available through my site are sold by Amazon.com
you are claiming that Amazon.com is selling pirated copies of your product.
If that is so, it is between you and Amazon.com
If you write me one more letter, I will do the worst thing that anyone
has ever done to you; I will stop promotion of your products and I
can guarantee that as a direct result, Amazon.com will, too!