You must be one heck of a nice guy to hand over money without getting anything in return. Get an estimate from your lawyer before you hand over even more thousands! Whilst you appear to have a case of breach of contract, you could quickly multiply your losses through litigation, the time, effort money and distraction that it poses. You could weigh up the impact of all of these on your time-to-market. If it's a really great idea, then you might need to re-group and attack again whilst the opportunity is still good.