It appears we have a solution.
Per apple: Greetings from Austin, Texas! My name is Ashley with iTunes/Mac App Store support. I'll be assisting you today. I hope this email finds you well! I understand that you are having some trouble updating iPhoto '11 on your computer. I'm sorry for this inconvenience, I know that this must be frustrating, and we greatly appreciate your patience with this matter.
Thank you for sending those screenshots, they were very helpful! I've checked your account, and I was able to locate your purchase of iPhoto '11 on your account "XXX". I'm not sure why you're receiving an error message saying that you purchased this application from a different account.
What I need you to do is locate iPhoto in your Applications Folder. After locating the app, drag it into the Trash. Once this application is deleted, we can redownload it to your computer.
You can redownload apps you have purchased from the Mac App Store without incurring additional charges.
It worked!