Honestly, I would want confirmation directly from the company that he is terminated. I would not trust that information from the company to the 401k plan to him is correct. Or that a "termination" code on a 401k statement means that he was terminated from the company. Someone could have easily miscoded it in the 401k information.

Has he been communicating with the dealership since he went out? Many companies require at least a minimum amount of communication while out on leave.

If they truly did terminate him, it was not illegal unless he was eligible under FMLA. I agree they should have communicated it to him in a different way, but it was not illegal.