I would say the seller is liable. Even if it worked fine when packed and shipped out, it apparently did not arrive in working condition. That means something likely went wrong during the trip, which no doubt subjected the device to more physical stress than it normally gets while sitting on an audio rack.
If I was the seller, I would make it right one way or another. Any reasonable seller should do the same. That may look different depending on what route you take (repair, replace, etc) but it should be on the seller to take care of the buyer.
If you can't work it out with them, I would start a paypal dispute sooner than later. You only have so much time for that process.