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If I'm not much mistaken, a Catholic school, even in New York City, is a private school. In addition, I am inclined to think that a city bus stop is a well-established, highly visible common, public bus stop.

I therefore don't see any comparison with a public school designating an area, presumably used for no other similar purpose, to be a place where children will gather and wait, twice a day, day in and day out -- children that otherwise would have no reason to be there, were it not mandated by the school district.

So I don't know who your friends should sue. Maybe they should speak to an attorney.