Originally Posted by FCYTravis

No, the "free bump up" (also called an operational upgrade) is given out to economy passengers with elite status first, in virtually all cases. The economy seat thus freed up is then assigned to an oversold passenger.

Originally Posted by hockeyguy

There is no such thing as "an oversold passenger"; if the flight is oversold, then there are more confirmed reservations than there are seats, but no passenger has any more of "valid" ticket than anyone else. In that case, it's usually the most frequent fliers who are given "operational upgrades" to make room in the other cabin.