// ADD THESE LINES
if (!empty($_hasChildren)) {
     $html .= '<a onclick="return false" style="text-decoration:none; cursor: default;" href="javascript:;" class="'. $outermostClassCode .' '. $_hasChildren .'">'. $this->escapeHtml($this->__($child->getName())) .'</a>';
     } else {
       $html .= '<a href="'. $child->getUrl() .'" class="'. $outermostClassCode .' '. $_hasChildren .'">'. $this->escapeHtml($this->__($child->getName())) .'</a>';
     }