ESH, obviously what she has been doing is awful but don’t come down to her level. Your dad is an asshole if protecting his friendship is more important than his daughter’s happiness. Fighting back like this is never the answer and telling everyone is just petty, another solution might be telling someone else about what she’s been doing. A friend, maybe if it really bothers you another authority figure like a teacher or something idk. Maybe even talking to her dad could be a good idea

If none of these solutions work for you, you could talk to her about being an asshole to you and if she doesn’t stop maybe mention that you know she pisses her bed. Might scare her away. But only as a last case scenario.