A 1099-C should be issued only when a bona fide debt has been forgiven by a trade or business. This situation has occurred before, and definitely creates legal problems for you. Without a loan agreement between you and this business, it's likely that the money he gave you was simply a gift.
But you don't want to wait for the IRS to come to you. You should consider getting legal advice to demand that your ex-fiance issue a corrected 1099-C, and for collecting any evidence that this was in fact a gift.
An internet search under "1099 Abuse" can give you more information.
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