I would be extremely annoyed if I were in the same situation as this flyer.
However, I'm not really sure what United is supposed to do here ... according to the article they had a mechanical problem with the original plane and the replacement plane had fewer first class seats ...
So somebody has to not fly in the first class seat.
Again, I would be very, very upset - but as an outsider looking in, it seems a bit childish and primitive to assume that whoever raced to the seat first gets to keep it, regardless of any other factors.
Again, United has to downgrade somebody to coach in this situation - it seems reasonable that they sort that downgrade to the lowest "status" passenger.