No reason, no comment at all, other than "it happens'. My question regarding whether they had seen other 2016/2017 MacBook Pro's with the same issue was met with silence.
This laptop is a late 2016 13" MacBook Pro without the touch bar, purchased on the day that they became available locally, but before the touch bar models were in stock. Essentially it is one of the first examples of the current style MacBook Pro. It has not been used for much more than web/internet, document creation, etc. It had no physical damage and it was always in a climate controlled space (I have a nice & light MacBook for travel). One day it was fine, the photos show what it looked like the next morning. Hopefully this was just an anomaly and not the start of others having batteries expand after 13 or 14 months.
The fact it happened so suddenly makes me wonder if the issue likes not in the battery itself, but in the charging regulation circuitry. It is supposed to start slow charging at approx 80% full to prevent overcharging the battery. If that failed one evening that could have strongly overcharged the battery.
The good thing is you now have a new machine. If they gave you a new charger, I would not use the old one, cable, or anything else associated with the defective's system charging.