Ask HN: My previous employer threatens to sue my new client over IP rights

While working for a previous employer, I have developed a free version of commercial service that their company was developing. I insisted that this free version must be published as open source project under GPL v3.0 licence (on the company's Github repository). The employer didn't mind, since they saw this free version as a "marketing tool".

That company has now completely fallen apart and the commercial version of the project has been proclaimed a failure and abondoned. On the other hand, two collegues and I have started our own company and among other things we have developed from scratch an improved version of the open source variant of the project. We did this pro bono for another company that we respect very much and were intending to let them publish this project under GPL licence and use it as a module in their larger product.

Now the old employer is threatining to sue our new client over intelectual property rights infrigement. They refer to this new version as "plagiarism", although original project was published under GPL and has been rewritten from scratch for our new client.

Do they have any legal basis for the case here? I know that I should not ask for legal advice here, but from what I have found the issue is not trivial and was wondering if anyone here has gone through something similar.