absolutely escalate this to a claim. You are correct, if you close the dispute then there is nothing more that can be done. Once it is escalated, then the seller will be REQUIRED to provide information to PayPal. Generally shipping an item back to the seller is not something PayPal will enforce, thats usually between buyer and seller. Considering it is an international shipping situation, you probably won't have to ship it back, but there might be a chance. With a domestic claim, the buyer is required to ship the item back and the provide tracking proving that they sent it. Either way, I would defintely escalate this to a claim.
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