Hi Welcome to JustAnswer. My first response will follow shortly. Please feel free to follow up if anything is not clear

I can understand why you are upset but would warn you that defamation is very costly. You can ask TradeMe to remove the comments and you can usually reply to the comments. But if you want to sue you would need to budget over $10,000 and may need much more. i can go into more detail if you want.

If you want to sue someone for defamation you would need to file a case in the District Court. Defamation is a specialty area of law, with complicated pleadings required. You would need to construct a good lawyer with experience in the area, and start with a statement of claim. This would then be served on the fraudulent seller. He would then have an opportunity to defend the case by filing a statement of defence. Commonly, in cases like this would go to a settlement conference, which is like a mediation chaired by a judge. If this does not succeed then you would have a trial. At the trial you would have to lead evidence of any damage which you have suffered. The level of awards for damages is generally related to the publicity. If this was publicly aired on Trade Me, then it is likely to be possible to check the number of views of the comment. That would have some effect on the level of damages. The amount awarded are not generally very high, and for something like this would be in the vicinity of $10,000-$20,000. The legal costs to get there may well eat up anything you get, if you succeed. If you are determined, I can suggest some names of experienced defamation lawyers.