If they countered your offer formally... then you're right, but they usually don't do that. When you signed the counter offer, was it a complete contract and returned to the seller prior to their withdrawal of the counter offer? If so, then you might have a case to talk to an attorney about... If not, then it's probably not much of a case. A contract is not a contract until it is complete and fully executed. You say they gave you a "highest and best" statement, I believe that was notice telling you they were entertaining other offers and that you should increase/strengthen your offer if you were so inclined....it seems you were not inclined.
First, consult your buyers agent for their opinion, then talk to an attorney. Most agents will have an attorney they can recommend that can at least give you an opinion without charging you a fee. Keep in mind that if you decide to pursue this legally, you will likely be hiring an attorney to sue for specific performance and it gets sticky and can be very time consuming. I usually recommend you just move on anyway... besides, I believe things happen for a reason.
The key to transactions like this is making sure you have a competent and experienced agent who can guide you so you fully understand exactly where you are in any transaction. I don't know if you have been mis-informed, if you don't have your own agent or if you just don't believe him/her, but clearly you're not getting what you should be getting from your agent since you're asking this question.