Python upgrade to 2.7.3 error

gistfile1.txt

$ brew upgrade python
==> Upgrading python
==> Downloading http://www.python.org/ftp/python/2.7.3/Python-2.7.3.tar.bz2
Already downloaded: /Users/graham/Library/Caches/Homebrew/python-2.7.3.tar.bz2
==> ./configure --prefix=/usr/local/Cellar/python/2.7.3 --enable-shared
==> make
==> make install
==> Downloading http://pypi.python.org/packages/source/d/distribute/distribute-0.6.26.tar.gz
Already downloaded: /Users/graham/Library/Caches/Homebrew/distribute-0.6.26.tar.gz
==> /usr/local/Cellar/python/2.7.3/bin/python setup.py install
Before install bootstrap.
Scanning installed packages
Setuptools installation detected at /usr/local/lib/python2.7/site-packages
Non-egg installation
Removing elements out of the way...
Traceback (most recent call last):
  File "setup.py", line 128, in <module>
    _before_install()
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 348, in _before_install
    _fake_setuptools()
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 402, in _fake_setuptools
    res = _remove_flat_installation(setuptools_location)
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 222, in __no_sandbox
    return function(*args, **kw)
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 275, in _remove_flat_installation
    patched = _patch_file(pkg_info, SETUPTOOLS_PKG_INFO)
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 222, in __no_sandbox
    return function(*args, **kw)
  File "/private/tmp/homebrew-__UNKNOWN__-0.6.26-3npo/distribute-0.6.26/distribute_setup.py", line 232, in _patch_file
    existing_content = open(path).read()
IOError: [Errno 2] No such file or directory: '/usr/local/lib/python2.7/site-packages/setuptools-0.6c11-py2.7.egg-info'
config.log was copied to /Users/graham/Library/Logs/Homebrew
==> Build Environment
CPU: quad-core 64-bit sandybridge
MacOS: 10.7.3-x86_64
Xcode: 4.3.2
CC: /usr/bin/clang
CXX: /usr/bin/clang++ => /usr/bin/clang
LD: /usr/bin/clang
CFLAGS: -Os -w -pipe -march=native -Qunused-arguments -fwrapv
CXXFLAGS: -Os -w -pipe -march=native -Qunused-arguments -fwrapv
CPPFLAGS: -I/usr/local/Cellar/readline/6.2.2/include
LDFLAGS: -L/usr/local/Cellar/readline/6.2.2/lib
Error: Failed executing: /usr/local/Cellar/python/2.7.3/bin/python setup.py install (python.rb:106)

Also got the same error.

I fixed my issue, see Homebrew/legacy-homebrew#11616 (comment)