Realistically, No small business is going to sue you (especially if you're essentially giving you're opinion). It's costly, a hassle and just brings more bad publicity.
yes, it's definitely a big strategy flop. it would have been much much more effective if they approach things with an honest attitude to solve the problem and less strategising.
i wonder about that too. with this attitude towards customer service, i think it'd be a steep road for the company to progress or retain its current customers going forward.