Magicjack Fraud, breach of contract Internet

On November 4th 2010, I renewed my service with Magicjack for a 5 year period.  Magicjack admits this and confirms I have service until November 4th 2015.  However, on July 4th 2012 it stopped working, when I try to dial out it says my number has expired.  In chat, they claim that yes, my service is valid but my number isn't.  I have a choice of paying $10/year to keep my phone number, or pay $10 to change to a different phone number.  I asked them to clarify exactly what they are saying, are they saying that I do in fact have service until November 4th 2015 but refuse to provide said service (which we both agree is paid for) unless I give them more money, they said this is correct.  When I asked for a refund considering they just admitted they will not provide the service, they refused to refund the money.