RE: What should I do?
Usually bully kids like that don't require a beating. They are used to people backing down from them. So what I would do is get up in his face, put your nose to his nose and tell him straight up to leave your friend alone. When he sees that your not going to back down he will most likely stop bullying your friend, at least while you are around. If he won't back down then just say "I've warned you" and turn your cheek. Then see what happens.