What is so concerning about it? Virgin lounge, Cross Country ticket, why would anyone expect to get access? Sorry, but Virgin provide the lounge for their passengers, not anyone elses...
Hmmm...The OP doens't give the full detail but I think that we can be sure wasn't travelling on a
Cross Country ticket. Assuming that by "full fare" 1st he means non-advance/non-upgrade then there are no first class single/returns with operator specific restrictions - they're all "Any Permitted" or "Not London".
Therefore the OP could have entirely legitimately been travelling with Virgin for a portion of his journey [on Birmingham-Coventry at least]. (And Virgin will have received a (small) proportion of the revenue in accordance with whichever fare/flow model is used nowadays.)
It's not a big deal but it seems clear to me that they should have let the OP in ( perhaps the point is moot-ish if he was adamant that none of his journey was with VT.)
Interestingly, Virgin Trains EC make this very clear and simple on their site
"Access to our Lounges
Got one of the following tickets? Youre welcome in any of our Lounges:
Fully inter-available First Class Season Ticket (i.e. ticket neednt be specific to one train company) ..."
I'm a little worried about about najaB's line of argument when he says this....
Well it does and it doesn't - AIUI Virgin pays the full cost of running the lounge and treats it as a marketing, rather than an operational cost. So so they get to choose who they want to let in or not.
... bit of a slippery slope that - I think the internal accounting procedures of an organization are irrelevant ( unless a restriction/derogaton forms part of the T&Cs).