You should respond to the lawsuit. That is all you can do... At this point, he has the burden of proving his case, you can't have it thrown for being ridiculous yet, he has to be given a chance to prove his case. You can respond with a motion to dismiss, or a general denial. After you win, and the judge sees that the case was completely frivolous, you will probably be able to get awarded legal fees and costs associated with defending the case.
But at this point, you have to actually respond to the case. It may be someone that goes around filing lawsuits and hoping no one responds... if it turns out to be the case, you could also file a counterclaim for abuse of process.
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