The Associated Press, Shepard Fairey and Mr. Fairey’s companies Obey Giant Art, Inc., Obey Giant LLC, and Studio Number One, Inc., have agreed in principle to settle their pending copyright infringement lawsuit over rights in the Obama Hope poster and related merchandise. 

Mr. Fairey used an AP portrait photograph of Mr. Obama in making the Hope poster. Mr. Fairey did not license the photograph from the AP before using it. The AP contended that Mr. Fairey copied all of the original, creative expression in the AP’s photograph without crediting or compensating the AP, and that Mr. Fairey’s unlicensed use of the photograph was not a fair use. Mr. Fairey claimed that he did not appropriate any copyrightable material from the AP’s photo, and that, in any event, his use of the photograph constituted a fair use under copyright law.

In settling the lawsuit, the AP and Mr. Fairey have agreed that neither side surrenders its view of the law. Mr. Fairey has agreed that he will not use another AP photo in his work without obtaining a license from the AP. The two sides have also agreed to work together going forward with the Hope image and share the rights to make the posters and merchandise bearing the Hope image and to collaborate on a series of images that Fairey will create based on AP photographs. The parties have agreed to additional financial terms that will remain confidential.