blackmail,possible lemon law infractions

ok,here's the just of it all and i have a few questions regarding this issue

veh#1-our vehicle,veh#2-there's
accident:took place in a small parking lot on or around Aug. 11th,veh#1 driven by unlicensed person,hits veh#2 that had stopped suddenly to flip off a pedestrian.no report made,instead written agreement made.asked for 3 estimates of repairs only got 1.owner of veh#2 requests $2500 for repairs,although rear ended in another accident.veh#2 bought used for about same price.veh#2 sustained minor damage to rear end,veh#1's front end totaled.
possible lemon law infractionswner of veh#2 requests repair cost of or around price that veh#2 was bought for.
Blackmail:veh#2's owners father arrive at our house on sep. 8th DEMANDING $500/month "OR" he reports it to insurance comp.

this seems slightly fishy to me and my questions are ,can they actualy do this legaly,and what should i do to refrane from going to jail?

They can report it to their insurance company. Most likely the worst that can happen is a lawsuit for the damages or maybe even a ticket. When you respond to them do it in writing because if this does go to court you will want evidence that you asked for 3 estimates etc.