so just to be clear - in your example:

If the third party is known, you can go after the buyer.

if the third party is not known, you would have to go after the seller.

In going after the seller, is the same process possible - ie. send them a legal complaint for damages of breach of contract?

so in this specific incident, Jeff sends trey a notice - Hey buddy - this watch is worth X, and since I was paying X-Y, and you breached the contract for whatever reason, you owe me the difference, otherwise Lawyer up!!!?