Shepard Fairey has filed for a declaratory judgment that his Obama image does not infringe The AP's copyrights in the photo on which it is based.
UPDATE: Here is a longer story from Randy Kennedy of the New York Times. He points out that, "further complicating the dispute, [photographer Mannie] Garcia contends that he, not The Associated Press, owns the copyright for the photo, according to his contract with the The A.P. at the time."
The complaint is here. It's nicely done, and about what you'd expect: the central idea is that Fairey used the photo "as a visual reference," which he "altered ... with new meaning, new expression, and new messages." One thing I found interesting is that the photo Fairey used was actually a much less tightly cropped shot that included both Obama and actor George Clooney (you can see it here). That's interesting because it signficantly weakens the argument against fair use that was summed up recently by Columbia's Jane Ginsburg -- "it kind of suggests that anybody's photograph is fair game, even if it uses the entire image, and it remains recognizable." It turns out that Fairey didn't use the entire image [or did he? -- see Update 2 below], but the fact that so much speculation about the source of the photo turned out to be wrong also serves as a reminder of how thin the relevant copyright is here: the most distinctive element of the image is Obama's face, and the AP has no copyright in that. So Fairey's position is even stronger than (I at least) previously thought. At the same time, I don't think I'd go so far as the title of this post by Jonathan Melber: "The AP Has No Case Against Shepard Fairey." (In fairness to Melber, he's much more cautious in the body of the post, saying that "the AP would very likely lose this case if it ever ended up in court.") As Daniel Solove said the other day, "it's hard to know what's up or down [with] fair use anymore."
UPDATE 2: Interesting forensic analysis via Daryl Lang at PDNPulse.com calling into question the claim that the photo used was the wider shot that included Clooney.
UPDATE 3: Ann Althouse hopes Fairey wins: "To make an Obama poster, an artist has to refer to some image of Obama, and Fairey chose a perfectly generic photograph. How else are you supposed to do an artwork about a famous person? Garcia's image was mainly the raw material Obama provided by having a face."
Ray Dowd of the Copyright Litigation Blog says the complaint "fails to mention Fairey's strongest potential defense: the poster is core political speech made during the course of a political campaign protected by the First Amendment. There is a lot of good case law about political speech, and the fact that the image was used and sold to promote a political viewpoint during a political campaign gives it a great level of deference."