Should I pay for a phone AT&T collected from me in Oct. and has been billing me and unknowingly ?

In Oct 2016 AT&T store in Staten Island customer rep. took my Samsung S7 edge and told me that i would not have to make anymore payments on the phone and issued my a new iPhone7. In March while reviewing my bill I saw that the phone was listed as my wife's phone and I was still paying for it. I spend over 6 hours in the store on March 5th, talking with the reps and on the phone. On March 8th i was told by the following week the phone would be off my bill. I paid my monthly bill a few days later and AT&T took that payment and paid off the Samsung S7 edge. Now I was am behind a month. A few weeks later I am given a credit return for the payments I made on the phone from Oct. 2016 -March 2017. But they (AT&T) refuses to credit me a return for taking my monthly payment to pay off a phone they have possession of or return the phone back as I have paid for it. 
I have spend every Monday since March 6th on the phone or going to the store to plead my case to deaf ears. They promise to return calls, which NEVER happens. I get passed around different customer service reps all the time and get promised a return every time and nothing materialized. 
I am at my wits end. I have been requesting this return of $477 to no avail. I am refusing to pay my bill until this is corrected. 

What should I do? Am I correct in requesting a return for a phone they (AT&T) has possession of? Should they return the phone?
I have always paid my bill but this time i refuse to give in to them and have reached my limit of spending hours and hours on the phone getting no where. 

thank you