Cadence, everyone loses in litigation. There is just nothing worth battling for here. My suggestion, have your attorney write a comprehensive letter explaining the flaws in their logic and make your best offer. If there is a settlement push for a dismissal with prejudice (meaning he can't refile and you don't have an adjudication "on your record").
If he still doesn't bite, tell your attorney to hang back and let him burn money proving his case. He's the plaintiff which means he has the burden of proof. Unless you are going to add a new cause of action against him you can deny his claims and put him to his proof without the need to bring your own claim.
You could also push for mediation now or later to try to come to a quick resolution with an impartial. In most jurisdictions it is mandatory to go through some sort of alternative dispute resolution before a trial anyway.
There has to be a basis for an award of attorney fees either based on contract or statute. Has he indicated the source of that?
It's going to be ok. Try not to let this take you down or be the focus of your life. If possible, think of it as a nuisance.
Of course you are the bad guy. He feels empty and broken inside and that must be your fault. It can't possibly be him, right.
