It appears that he did indeed assemble a machine gun. The damage to one of his kits was done to provide the evidence that he was manufacturing "machine gun kits" in order to obtain the warrant that resulted in the discovery of the machine gun in question. Apparently the original plan was to charge him for making the kits.
Now, I read that in order to obtain the warrant they asked him to mount a scope on an AR-15 converted to full auto. When he started working on it, they got him for repairing a machine gun.
The only "kits" I'm aware of were the .50 cal kits.