No. They shouldnt have a menorah. The equivelant Jewish symbol to a Christmas tree is a dreidel.
1. Why not have both? The Founders intended more religion, not less.
2. No Federal judge has any jurisdiction over a State or local matter involving religion. The 1st Amendment gives the Federal courts jurisdiction only over acts of Congress regarding religion. The 10th Amendment forbids Federal involvement in State or local concerns outside of that Congressional context.