Startup not clearing fnf settlement but asking to return the laptop

A friend of mine left a small startup (less than 10 people) because they were paying him peanuts inspite of high workload (9am to 11pm, remote work) and were not willing to give any raise (they were paying him less than 50k per month after working for them for 6 years). They often used the carrot dangling tactics where they would promise him and the others for "bright future ahead", which would eventually fizzle out to nothing but excuses. Now that he has left, they are not clearing his FnF settlement of last 2 month's salary but are asking him to return his laptop. They are saying that they don't have any money and the current clients are not paying anything, and they can only pay when the clients pay them. Can they take any action if he decides to not return the laptop till his FnF settlement is cleared ? PS: the laptop is clean, no monitoring software installed. It had been completely formatted before being given to him. So it's as good as a personal laptop.