(Image courtesy of Defense.gov) The Postal Service never obtained permission to use these sculptures at the Korean War Veterans Memorial on a stamp. (Image courtesy of Defense.gov)

A federal appeals court has upheld $540,000 in damages the U.S. Postal Service owes to a New England artist who did not authorize his sculpture to appear on a 37-cent Korean War stamp.

Last week’s ruling by the U.S. Court of Appeals for the Federal Circuit is a victory for Frank Gaylord, 89, a World War II veteran and sculptor.

Nine years ago, he sued the Postal Service for using his depiction of a squad of soldiers on patrol, the central part of the  Korean War  Veterans Memorial on the National Mall, without his consent. The 19 stainless-steel statues are known as The Column.

The decision by a three-judge panel affirmed an earlier ruling by the U.S Court of Federal Claims that the Postal Service should pay 10 percent of the $5.4 million in revenue the stamp has generated since it was issued in 2002 to commemorate the 50th anniversary of the end of the Korean War.

The ruling, first reported by the National Law Journal, was a setback for the Postal Service’s stamp program, which has come under criticism in recent years for tilting toward more commercial images.

USPS spokesman David Partenheimer said postal officials are “reviewing the court’s opinion.” He declined further comment.

The mistake by postal officials appears to have been an oversight. The agency used a photograph of the sculptures taken by an amateur photographer during a snowstorm in the 1990s.  The Postal Service paid the photographer $1,500, but did not seek Gaylord’s consent to use the image of his work before issuing the stamp.

Gaylord sued the USPS for copyright infringement.

The Postal Service appealed the lower court’s decision that a 10 percent royalty was the right amount in damages.

“There is only one nationally recognized Korean War Memorial, and the evidence readily allows the finding that, by 2003, that memorial — and particularly The Column within it — was a distinctively valuable subject for a commemoration of the veterans who sacrificed through service in that war,” Judge Richard Taranto wrote in last week’s decision.

“Under these circumstances, the trial court did not err in concluding that, faced with limited alternatives, the Postal Service would have agreed to a per-unit license.”