When you applied for CPT during the first year of grad school, your school was the one who granted you approval. You did not accept any illegal employment. Hence, I do not think what your lawyer is saying here makes any sense. But, what do I know?

Good luck bro!!

Guys just curious..In this scenario what are the other options we have if the I-485 change of status gets denied? No TPS filled. Just working on H1B since 2014.

@fromnepal, if your I-485 gets denied then you can file an appeal to review the application called motion to reopen. Regarding what happens to your H1B, here is a link
http://www.trackitt.com/usa-discussion-forums/i485-eb/1061380809/if-i-485-denied-then-h1b-is-not-valid

This is what I found in USCIS website.

while working on CPT, you are not voilating the F1 status and you are legally working under status.

If I-485 is denied, and your H1B is still valid, you can file for MTR that will take sometime to resolve the issue however chances of approval rate is low. During that time, if your H1B is in first 3 years, you can extend for another 3 years or if you H1B is in last 6th year, you can extend for another 1 more year to remain in status (You did not mention about your H1B status in detail, so I am assuming you have valid H1B). If your H1B is expired or going to expire and can not extend, then COS to F1 (join university).
If you want to continue with MTR, you can still work with EAD renew until your case is decided and in this case, you still have to maintain your H1B otherwise you will in Authorized Stay (AS) and the moment your I-485 is denied in MTR, you will be out of status from the date your first I-845 denial letter. So, consult a good immigration lawyer or ask your lawyer who filed GC for you for plan B.

Did the lawyer say how you have violated your F1 by working on CPT?

While just working on CPT does not violate F1, there was many ways to violate it. For example, not being full time student.

Anyway, there should be an I-20 or documentation that the CPT was approved.

As long as you didn't work before or after the date printed in your I-20 approved for CPT, there shouldn't be any problem. Looks like you have worked on CPT full time for more than 365 days. That would have disqualified you from getting OPT. And, looks like you have been working on TPS EAD this whole time, so shouldn't be a problem. I am in the similar boat as well. I worked on CPT on my last semester and then on OPT till my H1 got approved. My lawyer has not said anything to me so far. We are going to apply for my I485 now.