I have spoken with the ombudsmen and then again with paypal

I have to wait till the item is returned and if paypal refund the buyer I then go back to the ombudsman with a copy of the closed transaction papers and all the dispute info and they will then give paypal 15 days to put the money back in the PP account.

Paypal said that once I have the items back I am too call them and if there is any damage on the bears at all then they will review the case.

So now we have to wait till they are returned and go from there.