Warranty - or just a scam

I had a Samsung S7 Galaxy in good condition. The screen just stopped turning on and I was told my phone was still under the 1 year warranty that came with the Samsung phone. As long as the phone had no liquid or physical damage the warranty covered it. There was none of this. I was given a refurbished phone and told to send my phone in the same package that was given for the refurbished phone. I did so. After about a week and a half I received my original phone back with the screen shattered and told that it was not under warranty because there was physical damage. I know for a 100% fact the screen was never shattered when I sent this in. I had a small scratch on the opposite side of the cracked screen from when I first got it (not enough to crack the phone) but the scratch is no longer there....? Weird right?

Now AT&T is charging my account $600 for this refurbished phone they are making me keep and can do nothing else for me. The refurbished phone can barely hold a charge and is well worth less than my original phone. Not only do I have to pay for the crap refurbished phone, but I still have to payoff my old phone which has $500 still left to it. I could of very easily had this phone fixed somewhere else but I chose not to thinking this would be the most reliable option...was I wrong or what? Now I cant go somewhere else to get my phone fixed because the screen is shattered. I also went to plug my phone into the computer to grab all my stuff off of it and somehow there's this lock set on it and nothing can be downloaded onto my computer. Seems....odd?? 

I have been a loyal customer for over 10 years now and considering changing service providers. I would not recommend AT&T to anyone because of this reason. 

So my question...is there anything I can do? This obviously was not my fault in any way and something is very strange about the condition my phone was returned.