Not mine but this is actually what I did too.
I said I plan to charge back on my credit card. They threatened that if I did that, they can’t promise my account wouldnt be flagged.
I said “bet” and they removed the cancellation fee and cancelled the service.
Don’t shoot the messenger. They’re telling you how it works (and they’re right btw), that doesn’t mean they like it, much less that it’s their fault.