I don't think your friend has any case at all for making a chargeback - he got exactly what he paid for. And we ALL pay for bogus chargebacks.
The more interesting point is whether or not gift card merchants have some responsibility here. The general public is rather naive about gift card scams; such scams are common but rarely discussed until someone you ...
My first step would be to talk to the company that issued the card. Tell them what happened, and that you believe the money was stolen. They should be able to see when the money from the card was spent, possibly other information to help figure out what happened. And they should be able to tell you where to go from there.
There could be any number of scenarios that happened. Here are some possibilities:
Gift giver purchased card, but it was somehow messed up during activation. (Not likely, in my opinion.)
Gift giver gave you a card that he had obtained previously and thought it had money on it, but didn’t realize that it had already been spent.
Gift giver purchased the card,...