[downerending]

I would be completely on the grad students' side if they weren't withholding materials necessary to produce the grades. That, though, sounds a lot like extortion, and it's hard to have any sympathy whatsoever with someone doing that.

It'd be one thing for me to walk off my job. It'd be another thing entirely for me to run off with the only copy of business-critical data.

IANAL, but I wonder if there might not end up being criminal charges in some cases.