Cable Company Took Me To Collections For Failing To Return Equipment I Never Received

I recently switched cable companies. The previous one sent me a bill for equipment that I never received or used, dating back years ago. After several conversations with them, they refuse to acknowledge that this is a mistake.

Since I am not paying $350 for something I never received, I told them as much. The equipment that they allegedly sent me is also not worth even half of that. They threatened to take it to collections, and made good on their threat.

I have excellent credit, but don’t mind taking a hit out of principal here. This whole situation is asinine.

The debt collection company sent me a written notice. What should I do? Respond? Ignore?