What is your current custodial arrangement? At the very least, this child should be in counseling. It sounds like she has a lot of anger issues. If BM won't agree to take her to counseling, you could take her to court and the courts could make her. Also, she might be jealous that the baby has DH full-time and she does not. That doesn't make her behavior acceptable by any means, but I think some of her jealousy could be alleviated if DH spends one-on-one time with her when she is with you and if he makes a good effort to contact her frequently when she is with BM, to let her know he loves her and misses her. He also needs to enforce consequences when she is misbehaving, i.e. take away something she likes. He could tell her in age-appropriate terms that he knows that she is very hurt, angry and jealous, and she has every right to feel those things, but she can't take it out on other people (i.e. you and her brother) and when she's feeling that way and needs to get it off her chest she can talk to him or you, draw, go outside and do a physical activity that would help her burn steam, or go to her room to have space from everyone, but she can't be rude to you or your son.

As for BM, document everything. Keep every text, email, print off her facebook profile, and ask your lawyer if you can bring a small recorder with you to pickups/dropoffs and record phone calls. That way, the next time you go to court, you'll have good evidence.

Also, google "Parental Alienation Syndrome" and "Parental Alienation Syndrome kids books." Parental Alienation Syndrome (PAS) is where one parent tries to alienate the child(ren) from the other parent, when all the other parent wants to do is be there for their kids. Unfortunately, those who instigate PAS are often successful, so you really need to know information on this so you can try to fight it and help your SD.

It is up to your husband to set her straight. Period. That is not saying she should not listen to you, it is saying her father MUST put a stop to it. My DH spent lots of time w/his daughter when she came over and when I began to see her behavior getting worse, my DH's attitude was "but she's my daughter"...I finally made him understand he did NOT just have a daughter to worry about but a son who would be impacted negatively by her. He finally realized he could either 1. step up and put her in her place 2. have one messed up kid or 3. have TWO messed up kids...he then understood he had to put her in her place or actually have obe messed up kid that didn't live w/him and another not messed up kid that through no fault of his own ALSO did not live w/him. He then attempted to straighten her out, but when he realized that if she lived w/her mother there was little he could do, and because there was no obvious negligence or abuse he didn't have a chance in hell of getting custody, he realized he needed to then focus on at least ensuring one of his kids did not end up as messed up as the other. That doesn't mean he forgot her, he still attempted to have a relationship w/her while attempting to discipline her, but as she got older and listened less and got more rebellious he let her know he would always be dad, but that she had to respect him and his discipline/rules or she would not be influencing our son any longer. No, he never told her "I won't see you if you don't respect me", but he no longer attempted to bring her into our home and saw her outside our home when we traveled to see her...

Yes, I understand that is his child, but there is little that can be done if she lives w/the mother and is taught to behave that way. And it is not fair to let "BM" technically influence your child...and you need to stand up and protect your child from her...if they were both your bio-children you would never put up w/one children abusing the other or being a bad influence on the other. In an intact home that child would be heavily disciplined and as she got older, if she got worse she'd end up in a bootcamp or something...nobody says anything to a bio parent in an intact family that puts their kid in a boarding school or bootcamp to straighten them out and ensure they do not disrupt the lives of younger siblings...heck! Dr. Phil among others tells parents all the time to protect their other kids and put their kid in bootcamp, etc...it's just that once someone is divorced you have to put up w/it all or you aré showing preference for your current family's kids...

Nip this in the bud NOW! It will only get worse if you don't and your resentment will grow towards the child.

I don't believe this from a 5 year old.