Host refused a refund

[Colleen574]

I booked a vacation stay for a client with Great Spaces and due to a issue with Airbnb taking a payment on a day that my client did not know about the reservation cancelled. The host had a deposit of $3,500 for my client and wanted us to pay for the entire stay of $7,500. in order to get back the refund amount of $2,800.00+ which to me was ludicrous. A representative for the host contacted me and asked that I book on the host direct website which is against Airbnb's policy and stated that if I paid the full amount of the stay $7,500 plus the host will issue a refund for what the deposit was. I contacted Airbnb and asked to speak to a manager, and they "attempted" to work with the host who was not going to issue a refund at all. Several members of my client's party for the trip had to cancel airline tickets due to this issue. My client is now moving forward with suing the host and Airbnb for the inconvenience to the entire 16-person party.  

Any Ideas on next steps