The cog, hub, and lockring don't mate well. There may have been a recall and it may or may not be fixed but depending on how much it was ridden before the recall the damage could already be done.

He may have paid $275 for it, He may have paid less. He very likely kept a reasonable deposit from the original purchaser. Really though none of that matters. He is stuck with a bike that won't move. It's taking up floor space and money that could be used elsewhere and we're entering a season where not many adult bikes are going to sell. It's very likely that he would rather have $250 of cold hard cash then a giant '06 fuji track. If not so be it. $300s not a great deal.

Bike years are like car years. He's currently getting '08s.