What does the lease say? Most leases specifically list plugged toilets as the tenants problem, also they usually state that any damage caused as a result of tenant negligence is their responsibility.
So if you have a case that they are responsible you have to consider
1) keeping their damage deposit, which probably isn't going to cover the damage to this extent;
2) are you willing to fight for them to pay the damages and go to the landlord/tenant board or court.
If it was me I would try and have a rational conversation with them, show them the plumbers report and show them what their lease says. Good luck if you have to/decide to fight them for it.
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