The insurance doesn’t mind fighting for you because they will get paid by the company making the frivolous suit. You don’t pay much, 10$/month.
Although in this particular case, you wouldn’t even need that, since either you took the documents and that is criminal fraud prosecuted by the state or you didn’t take the documents and then the company would be in hella trouble if they perjured themselves to the public prosecutor claiming you did.
So if you have been wrongly accused, that may cost you nothing.
In every other country, the loser pays the winner's legal fees.
Unless your friend happens to actually be a legally licensed lawyer.
Sue someone who can spend millions of pounds (for the sake of argument) on defence? Better be certain you can win... against someone who can spend millions of pounds, and probably went to the same public school as the judge.
In America, legal fees can be awarded as additional damages. We should do it more than we do. But given those two options? I'm on Team American Rule, 100%