Comment Sounds like a lawsuit waiting to happen (Score 1) 2
If the seller knows the chip cannot be used for all of the normal purposes a typical buyer would expect it to be used for, that's a material defect. Failure to disclose could be grounds for a refund and for additional damages if his other components were blacklisted as a result.
Now, if the buyer got it third hand and can't prove the person he bought it from knew or should have known of the problem, he will be out of luck.