Defective Back on never used iphone 12

I was gifted a new iphone 12 still in box. And I know it was new and never used. Turned it on when I got it 2 or 3 years ago and seemed fine. It started the welcome sequence. I turned it off and didn’t set it up thinking I’d wait until my then current phone died. Well, a couple years later, my old phone died and I took the new one out of box and it won’t charge. Just flashes the logo on and off. Took to Apple Store and their diagnostic test says it’s a damaged or defective rear/back, whatever that means and that it would cost nearly $500 to fix. Errg. It’s a brand new phone. Anyone else have this problem? What do I do? It’s past warranty I’m sure.