Craigslist transaction went south...

I don't know your state but in a handful of states, including California, Michigan, and Nebraska, you must appear in small claims court on your own. (no lawyers allowed)  Recording your conversation is hearsay.  Hearsay evidence is normally excluded from a trial because it is deemed untrustworthy. 

If you think he is responsible for the damage don't invite him to your home and just ignore him.  If you feel, after talking to him that he is telling the truth you have the option to give him a refund.  

Good advice on all points regarding scammers and equipment swaps.

My view?  Depends on what your time is worth.

If you really need the $120, then let him fight you for it.  As the plaintiff, he bears the burden of proof, and your defense would be that after more than a week, there's no saying what he might have done to damage the unit.

If you don't mind standing on principle and have the time to respond to any court summons to address the matter, then let him roll the dice and take you to court.  Just keep in mind that if the judge decides in his favor, you may be hit with the additional filing fees which are probably about $150-ish.

First of all I am impressed with the number of upstanding and ethical people on this site who have said to just give him his money back! This is why I would never sell electronics on Craigslist although I'll bet nine out of ten transactions are fine! It's that tenth one that is not worth it! Personally if you are certain that the unit worked fine when you sold it I would tell him so and refuse any further correspondence! I have been to small claims court once on a matter of principle and it was a real hassle! (BTW I lost even though I was certain I was in the right!) As someone already suggested few people would do that for $120 unless they really felt that they had been scammed. I suspect he is either a scammer or he has hooked this unit up incorrectly somehow! I have heard of the scam where people buy a new unit identical to the one that is not working and then try to return their broken unit in its place! Do you happen to have a record of the serial number. Probably not but if so and if you really want to refund his money I would make it clear to him that you will do so only if he returns the unit you sold him!

the primary red flag on this deal is the guy immediately threatened you with legal action.   Over a $120 sale.   I would have to assume right from the start that something is amiss.     Either he lives under a rock and has no clue that situations such as these require tact in order to resolve with minimal stress.    Or ,  he is scamming you.  If you can not be sure that the unit he presents to you is not the one he sold you then tell him that and wish him luck.    Meet him in a public place to ascertain if it is the same unit.  There must be some identifying mark on it that you would remember?      This is of course a lot of hassle like many have said on here...but do you really want to give money back for a unit that is broke and not yours?     It is indeed the principle factor in play here.   You might want to just confront him with your suspicions and see how he responds.    Again,  what sets this all up as a scam is the guy making a threat on the initial contact of something wrong with the unit.    Maybe he is a bit of a doofus and knows squat about electronics  and thinks this is what he needs to do to get it resolved.   Poor communication skills if thats the case. 

meant to say if you can not be sure that the unit  he shows you is the one you sold him then I would walk on it.