Did my brother get blackmailed?

If I was him I would have quit the job.

That is illegal in so many ways. Your brother has the basis for a really sweet sexual harassment suit.

Yes, this is probably even a form of sexual predation/uncomfortable work environment, even a form of trading the job for sex (i.e., prostitution).

I think a good presecutor or other lawyer could make a case for several laws having been violated. If a Federal crime can be shown to have been violated, this would significantly enhance your brother's case, if he wishes to proceed.

The bad publicity alone might shut down the business.

That does sound forced. Time to report it to HR

What does he think now?

But he has a job and maybe a promotion

Did he return back in tact?

How did the date end then?

What country is this? Is this a very small town or under the table pay job?
Where is stuff like this openly discussed because thats crazy. And its not blackmailing but more so just sexual harassment.
What kind of father is his daughter's procurement specialist??
Yuck
Leave that job and report to HR