Asked to leave PhD program, is there any point in fighting to stay?
When doing your PhD you need the support of someone, so it is no use trying to finish your PhD if everybody in your department is against you. So if there is a conflict between your friend and his advisor that escalated to such an extent that the two cannot fix it themselves, than it is time to move up in the hierarchy. The graduate director can either try to mediate between your friend and his advisor, or try to find an another advisor. 

If that fails, then that is a horrible situation for your friend, which in most (but not all) cases a professionally run department should be able to prevent. In that case there is pretty much no other option but to leave and try his luck at another department. However, beware that that department will in all likelihood be in the same field, and scientific fields are like small villages: they gossip a lot. So, your friend will most probably enter that new department with a "reputation". Also your friend should consider his own role in the conflict in order to prevent making the same mistakes again. Remember, he already has a reputation, so he probably won't be treated as leniently as a new PhD student.