Can they do this?!??!

I just got a adg fly reel. Its warranty (found in the box) says :
adg colorado usa fly reel manual and
warranty
registraion says "If any part of the reel fails to perform for any
reason,
send it to us for repair with your address, receipt and registration
copy,
and $9.50 for shipping and handling."

Ok, sounds good, $9.50 to get it fixed FOR ANY REASON. I sent adg email
asking if I could register by mail. They sent me this:

* Now, warranty
on
reels are $59 for spool and and $69 for the other side with main drag
function part for replacement of new part when you send in defective or
damaged reel sides.