What do i do? go to court?

I have been allowing a friend of mine to stay with me for a few weeks. when we were out one day, he bought a dog off someone for $140. he didnt get a receipt or anything. since then he never stayed here iwth the dog. i bought everything else for it . food leashes, colars etc. everything. and have been taking care of him by myself . the other day he came into my house while no one was home (i left the door unlocked my mistake) and admitted to stealin g$80 dollars worth of alcohol. we got into and argument and took the dog and left. he ended up at another friends house. got in a fight with him and that gy called the cops on him. he was arrested for being under the infliance of drugs and alcohol. before he was arrested he gave the dog to another mutual friend that was there and said " here jess (me) can have titan (dog) " so that means he gave him to me. now that he is out of jail he wants the dog back and is saying he never said that. even tho i have noterized statments saying he did.