Sorry, but this assclown guy is way out of line. The value of prize packages of goods or services are always based on MSRP. Always. Go back and look at all the Bass Player giveaways, or any non-cash prizes for any contest, game show etc. The stated value will always be derived from a list price, not a discounted price from a retailer.
If this guy had understood and accepted that from the beginning, he'd have had his merchandise back in the summer of 2006.
Lawsuit? Yeah. Henry J. ought to sue him for libel.