If they had a report of harassment, it's their duty to come bangin on your door. You don't have any type of case whatsoever against the police. The only course of action would be to go the route of filing a false police report and harassment (by him sending the police to your door). It should be...
Do you mean literally "on the street' like a trench coat full of watches, or do you mean selling it online, or through other traditional channels.
You are allowed a certain $ amount per year in earning as a "hobby". Check the limits in your state as well and that may be the way for you to go...