Are her parents permanently absent, or were they just unable to make it to see the principal this time? Ask the bully's parents how they'd feel if all the kids s/he targeted counter sued for all the physical and mental harm caused, and see if they're still willing to go ahead with the lawsuit.

Those dumbass parents don't realize how lucky they are that their child is alive despite having a history of bullying other kids, because especially in today's climate, there's always a psychopath that shows up to school with a weapon to put an end to bullying, and s/he has a chance to learn from his/her behavior. As for the school, they should've recommended the bully for expulsion instead of your god-daughter, given that s/he has a history of bullying others with violence included and your god-daughter (I assume) was simply standing up for herself, but I guess that zero tolerance crap only applies to people that refuse to take shit from a bully, and not the people actually doing the bullying.