Threats to sue a complaining customer are like throwing gasoline on a fire. The law firms [King and Ballow's] action has generated incredibly bad publicity for JL Kirk Associates [bullying, unprofessional headhunter] and for themselves.Thus endeth the lesson.
The lesson here is that a complaint from a customer is an indication that something is wrong with your service. Fix the problem. Don't try to intimidate the customer, especially if the customer is a blogger!
The problem won't blow over and by the time all is said and done your organization's entire history will be public knowledge and the embarrassing details will be available on the Internet for years and years.
UPDATE: To make matters worse for JL Kirk Associates, their self-started controversy will be getting air time on News 2.