I'm finding that concept a little hard to follow. As far as I can figure out, Delwin commissioned a custom knife from Adams, giving him a description, dimensions, telling him what materials to use, maybe giving him a drawing? Adams agreed to make the knife, accepted payment in advance ... then he discovered another knifemaker makes a knife like the one Delwin had commissioned? Are we all agreed those are the facts of what happened?
Then Adams responded to that discovery with outrage. He felt Delwin had abused his trust so badly it was appropriate to steal Delwin's money. Or maybe his idea all the time was to "borrow" Delwin's money without his consent, but it was only "borrowing" because he always intended to pay it back sometime, when he got dragged into court or TGB&U....
Is this design so unique that it belongs to the other knifemaker and it would be an abomination for any other maker to make something similar? Is it something innovative like Rob Simonich's Parasite or Sal Glesser's Spyderhole? Nothing has been posted about that, unless it was posted and edited out before I could see it....
Another option would be to contact the customer, tell him that he can not make an exact copy of the design, and propose a modified version of it.
I think there was some level of deception by both parties, but two wrongs don't make a right.