Originally Posted by
airish
The issue is "class of service." I am AA EP and inquired with EP desk about upgrade from regular economy -- my concern was that AA would try to pass off a move to PE as an upgrade when I used a systemwide, etc. The rep said, "no, if you receive an upgrade it will be from regular economy to business class, since for this purpose, regular economy and premium are considered the same class of service." So here, in the opposite situation, the system doesn't view you as being downgraded, since AA (and I guess DL, UA, etc.) consider "economy" as a single class. In practice, you're getting an inferior product and I can't believe they won't refund the upcharge, but it's technically the same class of service it appears.
AA EP flyer
This is plain and simply wrong. PE is a separate fare and cabin class. How AA chooses to deal with certs and related UG's is irrelevant to its own COC and DOT rules.
AA will, at the request of OP, refund the fare difference between W and Y. That is refunded to the original form of payment. I trust that the reason that OP's employer gets the refund is that it paid for the ticket.
EC 261/2004 does not apply. ORD is not in the EU and AA is not an EU carrier.
As others note, OP had a refundable ticket ("full fare W"). All he needed to do was to cancel for a refund and then book whatever he wanted.