Well done Capot, you've framed the problem very starkly there - but I'm not sure it's really much different to any other denied boarding scenario. After all, in quite a literal sense, the airline has more passenger(s) than it has seats. Now and again I've seen cases on a full plane where two passengers get on board, each with boarding passes for the same seat. One of them has to get off, and it usually seems to be the one who got there second (unless the one already seated volunteers). Whoever gets off presumably gets the standard denied-boarding compensation.
The fatty-in-my-seat scenario would seem to be the same. Since the fatty is the one already in the seat (i.e. you arrived second, or you got up to complain), it's more likely that you're the one getting off. But there's nothing to sue over - you were denied boarding, just as if the airline had overbooked in numbers rather than, shall we say, in bulk.