If you really did knowingly sell him a bike that's been in an accident without disclosing that, then you should probably give him the money back. I'd offer to meet up with him and meet at a different bike shop for them to check it out and get their opinion on it. Nonetheless, I'd be willing to bed all this legal talk is a scare tactic and he's full of ****. Who takes someone to court over an $80 used bike? If the guy loses in small claims court(which he probably will), he has to pay yours and his court costs and you get off free. If he wins, you'll probably have to pay for the $80 bike plus $60 or so in court costs. I'd take the chance with this idiot.
If you didn't know the frame/fork were damaged, and it wasn't particularly obvious, then you were as ignorant as the buyer, and I still wouldn't refund him.
Last edited by ddeadserious; 06-28-12 at 12:40 PM.