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I had a similar issue with my son's preschool. If they file a claim in small claims court, you have your records which prove otherwise and in that case you could seek any attorney damages if you use an attorney to defend yourself. The court will not award you inconvenience damages for your time spent correcting their accounting problems, but if they file suit the court will try to ensure that you are compensated for any attorney costs. There would not generally be any pain and suffering damages either. I took a look and the statute of limitations for them to file a claim is 4 years. In some states, it only 2 year so that would have also helped put this to rest. Maybe send her a letter one more time and say that if she continues this wrongful collection attempts, you will be filing an injunction or restraining order against her for this through an attorney. Hopefully, that would be enough to get her to back off.