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What a joke, they shouldn't be able to refuse. Mods that don't relate to the problem are a non issue according to the law. If only you were a lawyer, you could charge them for your time they wasted and the frustration they brought into your life.
There's thread somewhere, might be on E90post.com, that explains in detail what rights you have regarding mods and warranty, read it and use the knowledge to your advantage.
Good luck
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