Using a placement of 'auto top', 'auto right', or 'auto left' works correctly: the tooltip is positioned to that side if there is room, or to the opposite side if not. But when placement is 'auto bottom' the tooltip is positioned to the top, without any auto adjustment based on position.
Please re-test using v3.2.0, which will be released later today.
No longer happening with v3.2.0: http://jsfiddle.net/77ak3/1/
Closing per @hnrch02.
Issue is back starting v3.3.0 and still presented in v3.3.7.
v3.3.0 -- http://jsfiddle.net/aartyukh/8c3udp45/3/v3.3.7 -- http://jsfiddle.net/aartyukh/8c3udp45/2/
Most helpful comment
Issue is back starting v3.3.0 and still presented in v3.3.7.
v3.3.0-- http://jsfiddle.net/aartyukh/8c3udp45/3/v3.3.7-- http://jsfiddle.net/aartyukh/8c3udp45/2/