If he just put up the picture and left it alone the he might be okay but If the kid claimed that she was arrested for something that she wasn't arrested, for then she can definitely take legal action.
Slander (or something similar)
Emotional Distress (as a result of the lie)
She would need to provide evidence that the kid said those things though. I'm not a lawyer, I just watch Judge shows so this is more like an opinion.
not slander if its true and public record....can't sue for emotional distress if it was your fault. Long as the kid didn't lie i'd start a claim against the school.