Need some advice about possible Paypal "scam" by a Steamtrades user.

Basically, I saw a guy selling TF2 keys on Steamtrades and decided to pick up 6 from him.

However he complained about receiving a few cents lesser(should be $0.80) than the agreed upon price because of fees and made a huge fuss. He even threatened to neg rep me. This left a sour taste immediately. Out of goodwill and to get out of this senseless conversation, I returned his 6 keys to him and asked him to refund me the money, which he promptly did.

Not too long after that, he removed me from his friends list.

Today, I received an email from Paypal saying the refund failed.

From my final two pictures, you can see that the refund has been removed by Paypal.

So, report him to Steamrep and get him marked and launch a dispute with Paypal?

*****NG is me

*****arcia is seller

*****mlg@live.com is seller's email

My item received

My payment

This is when he started complaining about the few cents short and launched his verbal threats. I decided to void the deal.

My return of the 6 x TF2 keys to him

His refund to me

Today's email from Paypal informing me of refund failure

Payment and refund record from Paypal website 1

Payment and refund record from Paypal website 2

EDIT: ACCEPTED MY FRIEND REQUESTED AND DELETED ME WITHOUT A WORD