Seller agent negotiating in bad faith

[Kevin Huang]

We were trying to place a bid for a property in the Los Altos area. The selling agent told us there were 7 offers and we were in the top 3. They were working on a counter offer for the top 3 offers. 

After an hour or so, our agent contacted us to say that there was a verbal counter offer for a deal if we added an additional $120k. So, we added this amount. 

An hour later, the seller agent said they offered this amount to all 3 interested parties and the seller picked someone else.

Now, I could have offered more for the property. the question is when they presented this counter offer, I was under the impression that if I gave that amount, the deal would be complete. Would this constitute as bad faith from the selling agent? Can anything be done at this point? Can I file an official complaint against that agent?