I already posted this on another thread, but I've had a similar experience recently, probably compounded by the fact that the missed upgrade happened before the merger and now we're after the merger.

On 3 Feb, I paid 20,000 miles plus $550 cash for the privilege of waitlisting for an upgrade to BusinessFirst on a 19 Feb flight from IAH to LHR. That upgrade did not clear.

I have since called CO twice - each time, they promised the money and miles would be redeposited forthwith. After that didn't happen, I emailed the MPSC, to no response. I am, right now, waiting in the queue to speak with the MPSC for the third time. Unless they rebate the miles while I am on the phone with them, the next call that I'm making is to my credit card company to initiate a chargeback.