I would say it's everyone's fault. It's not the fault of the dogs, it's the fault of the owners.
The GSD has a right to defend himself and his property, but if he's going to aggress, the owner needs to have more verbal control on him.
The poodle, if the dog is unliked so badly, needs to not be given a chance to be with the other dogs. The poodle could come over if it's kept on leash, under verbal control, physically separated from the other dogs.
The other people there laughing may have contributed by being excited. It was a situation that needed calm control. It's a tough way to learn lessons, but hopefully you'll work on call offs with your dog, hopefully your aunt will keep her dog away from dogs that don't like her, hopefully your aunt will work on training her dog to perhaps be able to play with the dogs, hopefully your aunt will spend more time with the poodle.
As for legalities, I hope it doesn't come to a court battle. If it won't be taken as an admission of guilt, I would pay half the vet bill.