That is a mill - if the conditions are inhumane - it's good to TRY to get pics if you can - but for SURE contact your local ASPCA and report them or better yet - have your friend report the conditions she saw. I'd even report them to the police if I were you - they will refer you to anyone that can help.....
also - you can email/call Animal Control AND the Radio and tv stations with what your friend saw....There are several people here who HAVE HAD mills invegistated - all it takes is one person caring enough to report them - I wish you the very best of luck - just by asking here I know you'll help and you could save those poor yorkies from a life of hell....
NewlywedWifey and Reconsmama have both reported mills and had GREAT sucess ...Go visit
http://www.millbusters.com/forums/index.php? and you'll find more info - and there is a Master Letter section where you can get ideas on what to say if you persue this - GOOD LUCK !