Escalate the claim to PayPal and demand a full refund. Only agree to ship back the product if the seller provides a pre-paid shipping label (which they won't). There are few hoops to jump through with PayPal, but you will receive a full refund.
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Refuse to send it back unless they provide you with a pre-paid shipping label; demand a full refund. There a few hoops you have to jump through, but you will receive a full refund.
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