Dose A product already owned error use the key?

I feel really stupid, I wanted to checked out playfire so after some time I earned a small amount of credit.I went to buy a game, Postal 2 was a thing I always wanted to try out. So I bought that from GMG using playfire credit. Went to activated the key on steam but apparently I already bought the game in some steam sale at some point, I had no memory of this and felt stupid but lost no "real" money so no big deal. I wanted to give the game away but I am not sure if it is still valid.

TL:DR. I used a postal 2 key for my steam account, found out i already own postal 2, is the key still valid?