No way to say without knowing more of the story. You might want to remind yer friend that at some early point he should make finding another job a priority. Obviously the company has looked into the issue and is being as pro-active as it can.
Personally, given a choice of sniveling to a lawyer about a lost gravy train or moving foreword, I’ll put my time, energy, and resources into moving foreword. While it might be prudent to talk with a lawyer, i'd treat that as a distant option but not a priority. Typically folks will spend weeks or months using a lawyer as a denial crutch, when most of the time all they are rewarded with is another bill. Eyes on the ball. Not moving foreword is the real BS.