Gaylord v. United States (Gaylord II)

Frank Gaylord (plaintiff) created The Column, a group of stainless-steel sculptures representing a platoon of soldiers. The Column appeared prominently at the Korean War Veterans’ Memorial (KWVM) in Washington, D.C. In 2002, the United States (defendant), through the United States Postal Service (USPS), issued a 37-cent stamp (the KWVM stamp) commemorating the fiftieth anniversary of the armistice ending the Korean War. The KWVM stamp featured a photograph of The Column, but the USPS never asked for Gaylord’s permission to depict The Column. The USPS sold not only KWVM stamps featuring the unauthorized depiction but also retail goods featuring images of the KWVM stamp. The USPS earned $5.4 million from the sale of sold but unused KWVM stamps, i.e., stamps purchased by collectors; $17,831.93 in licensing revenue collected from third parties that had licensed rights to the stamp image at an 8 percent royalty on their sales of retail goods; and around $330,000 from the USPS’s direct sales of retail goods. In 2006, Gaylord sued the United States for copyright infringement in the United States Court of Federal Claims. In the first appeal from that proceeding (Gaylord I), the United States Court of Appeals for the Federal Circuit held the United States liable for infringement, identifying three classes of infringing items: (1) stamps customers had purchased to send mail, (2) unused stamps purchased by collectors, and (3) retail goods. The Federal Circuit in Gaylord I remanded the case back to the Court of Federal Claims for a determination of damages. On remand, Gaylord requested a 10 percent royalty and presented evidence that he had earned royalties ranging from 8 to 10 percent on prior licenses of his other works. The Court of Federal Claims rejected Gaylord’s request, framing its analysis according to a “zone of reasonableness” concerning the value of a copyright license to The Column. The court credited testimony that the USPS had never paid more than $5,000 for using an image on a stamp and that it had paid a photographer of The Column $1,500 to license rights to that photograph. The court limited Gaylord’s damages to a one-time $5,000 royalty. Gaylord appealed again.