Your small claims court judge, in your area, does that. The judge in my small claims court does not, and not in any other small claims court in my county either. So, unless you have been in the majority of small claims courts, in the majority of counties, in the majority of states, you cannot make that claim.
Many people disagree with you about that. Sometimes it is better not to engage in the nonsense in the first place. Particularly when people are making ridiculous demands.If a small claims lawsuit is pending, as the OP is concerned with, the right advice IMO would be to at least communicate with the (would be) plaintiff. I simply said that "ignoring them or hiring a lawyer" is very poor advice.
It is technically losing, but I agree that for all practical purposes it is not.Cutting a loss in half is not "losing."

