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My most awkward recruiter interaction?

Just graduated college and got 'suckered' by an programming position ad that turned out to be a recruiting company. It was fine since they charge the company for their services and not me.
After a couple of weeks of waiting (they initially promised I would/could have at least 3 interviews a week, which hadn't happened.) I decided to start looking again on my own, found a position, and I was hired.

About two months later I get a phone call:

<skipping the pleasantries>
R: "I see you are working for D, congratulations. I've started the paperwork for our reimbursement."
Me: "Reimburse for what? I found that job on my own."
R: "D is one of the companies we work with and when we submitted your resume, they told us you were already hired."
Me: "And?"
R: "And you signed a contract and now its time to pay. The fees only start at $500"
Me: "Not me. I have the contract, it states, in the second paragraph, I am not responsible for any hiring fees."
<couple of seconds of silence>
R: "Yes, but that is only if we negotiated the contact. Since you went behind our back, we couldn't start the process"
Me: "And?"
R: "And its a breach of contract."
Me: "I'm not a lawyer, I don't understand what you're saying. It says right here on the contract I signed, I don't pay any fees. No where does it say I'm not allowed to look for a job on my own. Right?"
R: "Um..yea..right..right...but you were hired by one of our contracted companies."
Me: "No way I would have known that. Maybe you should have set up an interview long before now."
<R is getting pretty angry at this point>
R: "I'm sure we gave you list of companies we work with. Contacting those companies is a breach of contract. Unless you want our lawyers to get involved, the fee is only $500. Failing to honor your side of the agreement and we'll be forced to contact your employer and begin garnishing your wage until the fee is paid. You don't want that, do you?"
Me: "There was no list and I am allowed to find a job on my own. Again, I'm not responsible for you not setting up an interview so do whatever you think you can do. Have a good night"
<I hang up>

About a week later..

Boss: "Got a phone call from XYZ Recruiting requesting a wage garnishment. Do you know anything about that?"
<I explain the situation>
Boss: "Oh good grief. We've worked with them a couple of times and we contact them on an individual basis for new hires. You're fine"
Me: "You're not going to garnish my paycheck?"
Boss: "No no no, that's not how this works. He was probably trying to scare you into paying their crazy fees."
Me: "What if they get their lawyers involved? I don't want to cause any trouble"
Boss: "Ha ha...XYZ Recruiting is a couple of guys in an office and we have lawyers on the 3rd floor who eat and breath this shit. They know that and you won't hearing from them again."