Dunno, if you left the computer on, maybe it messed up when you weren't watching?
I'd just start the game. You can go to the character creator, tutorial and AP/Mercy, so that will get you started, and the game should continue to download in the background.
Inside the launcher, try to right click the arrow next to City of Heroes, and choose Repair. See if that doesn't eventually fix the issue. My first impression is that for some reason your connection timed out and that could cause something like this (so far as I know).
I left my computer on overnight to download the rest of the stages I needed downloaded (3 & 4). When I got up stage 4 was on 96% and it would not go up in percent even though I left it on downloading for another 3-4 hours. I decided to turn my computer off for a while and when I turned it back on i ran COH and a new window opened up saying that it was on stage 4 96% complete and connecting... above it in a seperate bar. When I launched the game it said stage 4 was on 0% in game on the icon on screen (not in the separate window) and will not budge, and the other window it still said 96% and connecting... How do I get it to finish installation?