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The course of action least likely to land you in legal hot water is to say as little as possible. Many employers adopt a policy of giving out only dates of employment, job title, and final salary to prospective employers. As long as you stick to easily documented facts and keep it brief, you will stay out of trouble.
If you decide to give more expansive references, use caution. If you make false statements about a former employee with the intent to harm his or her reputation, you might be sued for defamation.
For more information, see Nolo's article Giving References for Former Employees.