As said numerous times already in the thread go see a labor lawyer. 

Just to add to the discussion, I was working in a engineering firm with two partners ( a partnership venture between Indian and Chinese :D ).  The Chinese decided to quit and open his own business in the same field and the same city.  There was some non-competition contract when they opened the company.  The Indian came to the same scare tactics and send a letter to the Chinese saying he can't open a business in the same field and city owing to the non competition clause.   Turns out, if you decide to hold someone for the non-competition clause and stop them from doing business/working in the field, there is some kinda law which says that you will have to pay their existing income. 

I don't know the law but the logic as we understood back then is that if you are an expert in a field and make your ends meet by working in the field  and when you are barred from working in that field , you have no way to make ends meet.  If someone tells you that you can't work in the field of your expertise, he has to pay you your monthly wage till you start working in some other field (who is crazy to work if someone is paying for not working).  If you are not paid and you can't work in your field of expertise you die of hunger and in the US there is no law that would make people die of hunger.

Damn, I didn't intend to write such a long story.  Anyways, the bottom line is that you don't have shit to worry about.  Find a lawyer and counter that India, better sue him for all the metal anguish you are going through because of his insane letter and intention to stop you working in your beloved field of passion.  Just to add to the length, the Chinese suggested me to get a Jewish lawyer if I ever wanted to get something legal done efficiently.