Amazon shipping lost my package

Hi all,

I sold and shipped an item earlier this month and it looks like the package was lost in transit. “Deliver by” date does state 7/29 but Amazon shipping has told me the package is lost. The last known tracking indicates the item was also “The package is being returned to Amazon” with no additional updates so it’s confusing. Also, at some point the buyer prematurely complained that the item is counterfeit (before even receiving it) but Amazon seller reps say there is no return authorization or request.

Anyway, Amazon shipping says I need to refund the buyer and then file a claim with them but they said that the claim would only cover the cost of the shipping and not the item. I can supposedly request to be reimbursed for the value of item (based on what I sold it for) so long as I provide the proof of refund to buyer. But I can’t even get that far to confirm before refunding first. It feels a bit like “chicken or egg” here.

At this point, should I just refund the buyer and then file a claim and see what happens?