When selecting a photo to use on its popular “Liberty” stamps, the Postal Service unknowingly used a replica of the 128-year old Statue of Liberty. Instead of the original version welcoming the tired, the poor, and the huddled masses in New York harbor,  USPS selected the “fresh-faced,” “sultry” and “sexier” 17-year old version summoning merry-makers to the New York-New York Hotel & Casino in Las Vegas, NV. Robert Davidson, sculptor of the Sin City version of Lady Liberty, has thus filed a copyright infringement action in federal court, seeking unspecified damages.

The Postal Service didn’t intend to use Davidson’s version over the original, but the Getty Image that the Postal Service chose for its 2010 Liberty stamp was mismarked. An alert stamp collector discovered the mix-up after the stamps were issued, which was revealed by the philatelic magazine Linn’s Stamp News. When faced with the discrepancy, the Postal Service gamely stated, “We still love the stamp design and would have selected this photograph anyway.”  That comment, however, provides more grist for Davidson’s contention that the Postal Service is intentionally profiting from his creation.

Davidson’s infringement action against the Postal Service based on a stamp’s depiction of a public icon isn’t unprecedented. The sculptor of “The Column” – a platoon of foot soldiers at the Korean War Veterans Memorial in Washington, D.C. – won an infringement action against USPS for a stamp depicting his creation. In that case, the Postal Service had paid a photographer $1500 for rights to use the photo of the statues but didn’t seek permission from the sculptor, Frank Gaylord.

Gaylord sought over $3 million for the infringement on the basis of a 10 percent royalty from the assumed revenue from the sale of 87 million 37-cent stamps. The court agreed that the stamp infringed the sculptor’s copyright, but initially awarded Gaylord a mere $5,000, based on the finding that this was the most the Postal Service had ever paid to incorporate an existing image on a stamp. Gaylord successfully appealed the damages award and on remand the court granted him $684,000. The court calculated this amount based on an analysis of unused stamps purchased by collectors, which were “nearly pure profit” for the Postal Service. This new determination is now on appeal.

Unlike Gaylord’s sculpture, Davidson’s version of Lady Liberty was not a brand new creation but a derivative work. Still, Davidson is entitled to copyright protection for the changes he made to the icon. The Postal Service’s public statement that it preferred his version of Lady Liberty to the original could help establish the importance of those changes and the Postal Service’s infringement. As to damages, the Postal Service produced over 5 billion Liberty stamps – much more than the 87 million stamps depicting Gaylord’s creation. But Gaylord’s creation was issued as a commemorative stamp (aimed at the collector’s market), while the Liberty stamps were issued as booklets and coils (intended for customer usage).