Don't you think this will be absolved with a review of Shred Video's code/methods vs Smule's code/methods? And isn't it telling that Shred Video is more than willing to submit to such a review, but Smule has not yet acquiesced?
In my understanding, refusing it is only the "right strategy" if your intent is to not have the case go to trial.
And...I saw the court filings...you have a lawyer...stop talking to randos on HN for advice. :)