Yamer, my advice to you from a long experience - let it go and don't waste your life on petty grievances. Unless you stand to lose contract money that you believe you've earned, it's not worth it, period. And based on your preamble, you don't. It will ONLY make you feel worse. Guaranteed. Move on.
There's one thing that I would suggest you do: call your former GM and in a friendly manner ask him directly if a) you could give his name as a reference and b) if you should worry about giving his name as a reference? Don't bring up the new hiring, don't question your lay-off, don't ask for explanations or reasons. Just secure a good reference. 9 out of 10, you will get it, if for no other reason than guilt feeling he may have over letting you go and free up space to hire a relative.
Best of luck to you.
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"An idea is always a generalization, and generalization is a property of thinking. To generalize means to think." Georg Hegel
“To generalize is to be an idiot.” William Blake
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