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I am very sorry to learn of this situation, it appears that you likely do have a legal malpractice claim against your attorney.
Legal malpractice cases are based almost entirely on expert testimony. You must not only find an attorney to act as an expert witness regarding the standard of care for your prior lawyer (to prove the "negligence" elements of the case), but also an attorney expert (and potentially other experts) to testify regarding the underlying claim (you must prove that absent the attorney's malpractice you would have achieved a better result - often termed "the case within the case").
Due to the complexity of these claims, I highly recommend that you retain a legal malpractice plaintiff's lawyer (also called trial attorneys). Fortunately the majority of these attorneys will provide you with a free consultation, and many will represent you on a contingency basis (they will advance the costs of litigation and legal services in exchange for a portion of your successful settlement or judgment).
You can find local attorneys using the State and Local Bar Association directories, or private directories such as www.AVVO.com; www.FindLaw.com; or www.Martindale.com (I personally find www.AVVO.com to be the most user friendly).
In addition to a legal malpractice claim, you can also file a complaint with the Texas Bar Association regarding your attorney's conduct (in my experience, an attorney embezzling or stealing from their client is one of the few claims that results in actual disciplinary action on the first complaint). If you do choose to do this, please consult with a legal malpractice attorney first (this is a strategy consideration, and filing a complaint with the bar does not compromise your malpractice claim in any way, but it can impair negotiations for a settlement). See: https://www.texasbar.com/AM/Template.cfm?Section=Problems_with_an_Attorney&Template=/CM/HTMLDisplay.cfm&ContentID=23739
As I noted above, what you posted appears to be a legal malpractice claim. (So "how can an attorney harass a client he knowingly wronged?" - he cannot unless he is violating the rules of professional conduct).
You can write him if you like, you can file a bar complaint online (you don't even have to be in the state), you can even try contacting legal malpractice attorneys in TX from IL if you like (the three sites I provided you with will give you access to contact information from anywhere you have internet access). Unfortunately, I cannot tell you what to do specifically (we cannot provide you with formal legal advice or instruction on this forum). My "advice" to you would be to contact a local legal malpractice lawyer, but short of that you have those other two options available to you, and you can pursue both of them (they are not exclusive).
If you are giving up as far as fighting him, I would understand (you can probably at a minimum negotiate down the amount he is claiming), but, please at least file a complaint with the State Bar, with bad attorneys like him, it makes the rest of our profession look terrible, and if you don't report his conduct he will be able to go and take advantage of other clients in the future.
You can definitely try to work with his partner. As I noted above, if nothing else, try to minimize the amount you are paying out of pocket.
If you are sending them a demand, make sure to summarize your timeline as well, and attach copies of letters and emails (all your critical correspondence) in support of your position, it can help show that you really do have everything together and perhaps will motivate them to take the matter more seriously.