I've been able to get to phase two a few times. In phase two, he re-enables healing, but I'm pretty sure he gains some type of damage reflection because I hit him with a hero strike and immediately lost the battle. He didn't even take a turn where he could have actually attacked, just, "Hey, I saw that you did 22k damage in one hit. Would you like to retry the battle?" I don't think that he's supposed to be beatable.