Ok, you said this person is using a logo that you designed for him? Can you prove that you designed that logo and stationary? Can you prove that he did aq stop pay on the grounds that he did not recieve the items in question? That is a breech of service agreement. That logo is yours until you sign over the rights and officially say that it is his. The only out he has is by proving that someone else came up with the logo. Take him to small claims court. Make sure the case goes to trial. If it goes to trial, he has very little to stand on.As the designer of that logo, you are the owner until proof is supplied (contract, payment voucher-not canceled, etc.) that you turned over rights to him. Ifyou have proof that you designed the logo, proof that he stopped payment says that he did not recieve or has decided not to accept the work. So if you have proof he is using the logo that he claims he did not recieve then he will be ordered by the court, to pay you for what is owed, plus compensation for the hassles and trying to rip you off. Once the case is heard and judgement is made, get a copy of the judgement and send it to PayPal, BBB and the chamber of commerce in the city/town of this person`s business. Cases such as this in small claims are public after the fact, so nothing can be done legally for you sending a copy of the judgement to these organizations. Now different states may have different laws, so check on it first, but if this person scammed you, it is a good chance he is scamming others.
The only other suggestion that I could give you for future customers is to send a copy first of the logo with a contract detailing that a logo is the property of you/your company until a signed invoice is faxed or mailed to you stating that they recieved the works in question.
Every two years the Graphic Artists Guild puts out a really good handbook (Graphic Designers Guild Handbook) on pricing and ethics. One of the last chapters has sample contracts and invoices that are industry specific. Everythig from websites to book illustrations, logos to multimedia. It gives sample Cease and disist letters, gives advice on what to do before it reaches a level of calling a lawyer and what to do if you do have to resort to taking someone to court. Barnes and Noble are usually good about carrying this handbook in the art book section. If not, check out a local college that has a graphic design class.
With all of my rambling, the most important thing to remember is that if you can prove you did the logo and he is using it after denying payment for not receipt, then the logo is still legally yours.
I`m sorry that happened. I don`t have much to add except to say I know how you feel. I had someone buy a book from me last month and then the day after delivery, they filed a fraud claim against me. Interesting that they waited until the book was delivered to do that. Luckily, the book was trackable and had been sent to the address on the account. They lost. I can`t imagine how some people can sleep at night...