Depends on how much you want to risk. If you resist the transfer, they can easily haul your butt to court. A lawyer will cost you a minimum of $125/hour. If you do end up going to court, you may be liable not only for giving them the domain name but also their lawyer's fees. (you would be talking minimum of $50k)
If I were you, I probably would just transfer it, unless you feel lucky. Is asking them for $1,000 really worth costing you a lot more if they decide to sue you?
Precedents are in their favor, you will lose a court battle...