So, about half an hour ago, a strange thing happened.
I was playing normally, both qp an ranked, and totally randomly, just as a match was found I got a “Failed to apply update” message while Kings Row was loading normally in the background.
I stayed in my group and was able to communicate with them, I did get the “rejoin match” option displayed in the menu. But when clicked upon, I got thrown out of the game an needed to login again.
Got a ban and a 50sr penalty…
What the hell happened and how come an update was even considered by the game engine mid que?
Same thing happened to me just now. Except i got demoted. Hoorah.
Greetings Levistus
Sorry to hear you suffered a game penalty due to an update error.
It seems you are not the only one to have experienced this issue, as it seems the game forced some people to get the update applied, thus closing the game.
Should you all still have issues with the game updating, please try to run a scan and repair to the game to make sure it is properly updated:
In the meanwhile we appreciate any additional information players can provide us on this issue, so if you are still having issues with this, you can all collect some logs files and email them to Techinfo@blizzard.com with the subject “Overwatch is not picking up the 1.40 update.”
Be aware this is more for an ongoing issue on the US region, as you can read here on this thread so you can provide the info there if you prefer:
These files will help ups better understand what may be causing the problem and hopefully resolve the root cause.
Thank you for your reports! 
This issue have been there for 6 days and still not fixed.