When does seller's responsibility end?

IMO as soon as item is delivered and confirmed to be in working order. I would say 24-48 hours or so after delivered.

12-28-12: Muzikat
Thanks to all.
Sgordon1 that is exactly the problem. Nothing has been diagnosed, nor has any cost of repair been put forth. It is all based on his word to Paypal.
I believe if the USB isn't working it is due to user error.
Muzikat

Too early to know or worry what PayPal will do.

I hope you saved all your emails between you and the buyer from day one to the present. Day one being the first time the buyer first inquired about buying the DAC from you.

I suggest you send a copy of all emails along with the original ad you ran for the DAC to Paypal.

Also in your reply to PayPal state when you shipped out the DAC the unit worked fine.

If I were you I would say you nor PayPal have any proof that there is a problem with the DAC..... The problem could be user error....

The only sure way to find out if there is a problem with the DAC is for the buyer to have the DAC checked out by a qualified service tech.
(From my limited experience with PayPal the buyer eats the shipping cost, if any.)

More than likely PayPal will agree and require the buyer to have the DAC checked out.

PayPal will more than likely require the buyer to provide proof the buyer has the DAC checked out by a qualified service Tech. They will not just take the buyer's word. The buyer will have to provide documentation with an official business typed letterhead.

When corresponding with PayPal choose your words carefully.
You will catch more flies with honey than with vinigar.

Good luck.

+1 Jea48.

I am not endorsing PayPal, but I have several hundred (if not more) transactions with them, almost all positive. And with the few problems I have had on PayPal, I feel that the PayPal team acted fairly and timely. Making forst contact with them is a little problematic, but once an complaint is filed they are pretty good about following up. A couple of wods of advise:
1- Have all of your documentation in order regarding what you shipped or received. You DO have documentation, right?
2- Never get angry or upset with the PayPal agent, either in word or writing. They deal with angry people all day, and I assume that they just write off the jerks.

PayPal makes and receives payment via several methods, including bank cards. In the U.S. most bank cards require a no questions asked 30-day return, some are 60-days. In Europe and Asia 45 days is quite common. So while 2-7 days may seem reasonable for several of the posters above, it's not reasonable according to PayPal Ts & Cs and may not be legal. If you don't like it, don't play in PayPal's sandbox.

Rlwainwright - re: the situation with the watch. I'm just curious - did you happen to check the shipping weight of the package? It seems that it would be obvious whether the watch or an empty box was actually shipped. That would indicate whether this was a PayPal or USPS claim issue.

Agreed
Refund the money BUT Ask him to return the unit FedEx at his expense and never deal with him again.