I agree with what you are saying for the most part. The relationship seems trashed. However, I don't think that the investor is at a disadvantage legally, at least he wouldn't be in the US. Here the legal system is the perfect tool for a rich individual/organization to bully and harass anyone without a sizeable legal warchest. See: Scientology. So my advice is still to try every diplomatic strategem you can. Don't just assume this investor is just a total dick. There is some evidence to the contrary: he funded this young guy in the first place. If it is all about emotion, then try to find a psychological solution.