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verizon iphone 4, bad esn, what can i do?

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I bought a verizon iphone 4 off craigslist. The phone was brand new. Within a few days it was activated to the contract of the guy I bought it from. So right now the phone has active service. I just used the phone, dialed *611, checked the accounts balance, $1300. Obviously the guy who sold me the phone is not going to pay off balance and deactivate the phone he sold me. What can I do to get new service going on the phone? Should try to unlock it? or jailbreak the phone? Right now it's still receiving service, I can make calls on his line/service. Help! and Thanks! Also, the guy has magically disappeared from the face of the earth.

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