Here are some thoughts on your scenario:
There are a number of generalist clans of medium status, some regional (Ripened Sheaf, Black Pinnacle, First Moon) some Empire-wide (the Golden clans). You'll probably want to pick the High Clan based on where you want to game to occur.
I'm not sure what the clan-cousin's offense was. Tsolyani culture doesn't generally care about consensual relations. Is he supposed to have assaulted the high clan woman? or verbally insulted her?
Your description implies that the assault took place in some other town than the one the PC's live in, but you don't actually say this. Also, it's not clear where the offender is. In the PC's clanhouse? Imprisoned in the other town? Could you clarify?
My sense of things is that in general, if a high clan claims that a medium clansman has offended one of their members, it's a matter for a negotiation of a shamtla (blood money) payment. The negotiators will be leaders of the lower status clan, and someone of more or less authority in the higher clan, depending on how important the matter is to the higher clan. Unless the charge is absurd, and there are high status witnesses willing to contradict the high clan claim, the medium clan is going to pay, it's just a question of how much. In any kind of a "he said, she said" situation, higher status wins, hands down. Ordinarily this would be worked out just with a payment or adjustment of existing inter-clan contracts, not by surrendering the offending medium clansman for personal punishment. It could happen, but it would be unusual.
So in the situation you describe, I don't see the bind. Medium Clan pays, and does its best to suck up and protect the valuable relationship. To suggest or even strongly imply that High Clan's claim might be false would be to insult High Clan's nobility (a noble high clan would never press a false claim...), and thus just make things worse.
This is obviously a big deal for the medium clan. Why are the PC's views being considered? Are they elders, or important clan members?
The things I can see for the pc's to do:
retrieve their hapless clan cousin, with as little expense and scandal as possible. (assuming he's locked up some where)
deliver the shamtla payment, and suck up (fun?)
find out what's behind the claim. Did he really do it? Is somebody in High Clan just shaking down Medium Clan for extra cash? Is there a bigger problem between High Clan and Medium Clan?
What do you want to happen in the game?
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