I would definitely put them on notice that if they don't settle of their own accord (making sure you set them a reasonable deadline by which to do so) then you'll proceed to SCC - they need to know that you aren't messing around and will be prepared to go as far as necessary.
They will be counting on you puffing out your chest and banging the table. But with obstinate fucks like this, that rarely gets results. So, you need to have the next step up your sleeve, ready to go.
Gone but not forgotten:
325i M Sport (E92), Black Sapphire, Coral Red Dakota, 19" 225's, Seat Heating, 6FL and de-badge
Replaced by 6.2 litres of AMG powered C class.