IP Law Daily Replica Statue of Liberty sculptor awarded $3.5M for image’s use on postage stamp
Monday, July 9, 2018

Replica Statue of Liberty sculptor awarded $3.5M for image’s use on postage stamp

By Thomas Long, J.D.

Sculptor Robert S. Davidson was entitled to over $3.5 million in damages from the U.S. government for infringement of Davidson’s copyright in a large replica of the Statue of Liberty installed on the grounds of the New York, New York Hotel & Casino in Las Vegas, the Court of Federal Claims has decided. The U.S. Postal Service used a photograph showing the head of the sculptor’s work on a postage stamp, believing it to have been a picture of the original Statue of Liberty. The court determined that Davidson’s work was original and entitled to copyright protection, and that the Postal Service’s use of it was not permitted by statute. The replica statue’s "more feminine" face made it original enough for copyright protection, and the postage stamp at issue copied protectable elements of Davidson’s work. The court determined that the $3.5 million damages measure represented the fair market value of a license to use Davidson’s work as the government did, assuming a willing buyer and seller negotiating at arm’s length (Davidson v. U.S., June 29, 2018, Bruggink, E.).

The replica designed by Davidson was constructed and installed on the hotel’s grounds in 1996, and Davidson obtained a copyright registration for the work in 2013. Davidson contended that his intent in creating the work was not merely to copy the Statue of Liberty but to create a unique and original work. The replica’s face, according to Davidson, was intentionally not a perfect copy of the actual Statute of Liberty. The government did not dispute that it used an image of Davidson’s statue without permission, but it argued that Davidson’s replica was too similar to the genuine Statue of Liberty to be entitled to copyright protection itself, and even if it was, reproducing a photo of the work on a stamp was fair use.

In a July 24, 2017, the court denied the government’s motion for summary judgment, holding that there were factual questions as to whether the differences between the works related to the copied elements, Davidson’s intent in the fabrication process, the amount of discretion afforded to Davidson in the design and the choice of materials, and whether any differences were dictated by necessity rather than artistic choice. In addition, the court declined to rule that the government’s reproduction of a photograph of the replica was fair use. In September 2017, a two-week trial was held, and post-trial argument took place on May 1, 2018.

Validity of copyright. The court first addressed the question of whether Davidson held a valid copyright in his statue. Because Davidson did not register the copyright in his work within five years of its being made publicly available, he was not entitled to a statutory presumption of validity, and he instead was required to show that his work had the minimal degree of creativity required for protection. There was no question, the court noted, that Davidson was hired to create a replica of the Statue of Liberty, but he testified that he was given artistic license, and that he had intended and created a "more contemporary and feminine" face for his statue. Davidson also testified that he used his mother in law as inspiration for the "fresh" look of his replica statue. The court stated that it was satisfied that Davidson succeeded in making the statue his own creation, particularly its face. The differences were visually observable, could be articulated, and were not merely "ideas," according to the court. The differences were meaningful and not trivial. Therefore, Davidson’s work was the subject of a valid copyright registration.

Copying. Next, the court decided that the Postal Service copied original elements of Davidson’s work. It was the face of the Las Vegas statue that appeared on the postage stamp at issue. All of the testimony at trial concerned the faces of the two statues and whether the Las Vegas statue’s face was different from the face of the genuine Statue of Liberty. In the court’s view, the conclusion that the government infringed Davidson’s copyright was thus "inescapable." The Postal Service copied all of the original elements of Davidson’s work.

Fair use. The court rejected the government’s fair use defense. The Postal Service used the image on a "workhorse" postage stamp, printed billions of copies, and sold them to the public as part of a business enterprise. The government collected over $70 million in revenues from sales of stamps bearing Davidson’s copyrighted work. Some portion of that was owed to Davidson as damages, the court said.

Damages. Finally, the court considered the amount of compensation owed to Davidson under 28 U.S.C. §1498(b). That statute states that when the court finds infringement, it should award "reasonable and entire compensation as damages for such infringement." This measure is the same as under the Copyright Act’s provision for actual damages, 17 U.S.C. §504(b). The applicable measure of damages as the fair market value of a license to use Davidson’s work as the government did. The court looked at evidence of the Postal Service’s own licensing practices, including what it typically pays for art and what it demands to license its own art, as well as expert testimony on the value of a hypothetical license. Assuming a willing buyer and a willing seller negotiating at arm’s length, the court concluded that the most appropriate measure of damages was a mixed license that employed a flat fee for the postage stamps used to send mail and a running royalty for retained stamps and philatelic products. The court noted that the Postal Service’s revenues did not meet its expenditures and reasoned that the Postal Service would not have granted a running royalty for the stamps used a single time to send mail. Therefore, the nominal and historically accurate sum paid by the Postal Service—$5,000—was an appropriate flat fee for this use. However, the Postal Service made money on a portion of the stamps—specifically, those sold to collectors, for which the Postal Service made almost pure profit because it did not have to incur the expenses associated with delivering mail. In the court’s view, a 5% running royalty on unredeemed and philatelic products was a reasonable figure, as indicated by evidence of the average rates for similar works. Applying this rate to the relevant postage stamps and other products, and adding the $5,000 flat fee, the court arrived at a total sum of $3,554,946.95.

The case is No. 13-942C.

Attorneys: James J. Pisanelli (Pisanelli Bice PLLC) for Robert S. Davidson. Scott Bolden, U.S. Department of Justice, for the United States.

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