Employment Law Questions? Ask an Employment Lawyer.
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She can use the information as she sees fit but she has to be careful not to slip over into the area which could be considered as extortion or blackmail. Essentially that would be where she threatens to reveal illegal acts or embarrassing information unless they provide something to her in exchange for not releasing or using the information.
What she may want to consider is hiring a local lawyer to handle the negotiations and letting them use the information. They are trained in how to do that without crossing the lines and, in addition, nothing they do could be used against her.