I can’t make a comparison to the case you’ve cited though since there are no images attached to the link. However, it’s not just a matter of posterization and color change in Shepard’s image, where the background and composition are significantly different than photograph. The angle of the face, the position within the frame (thereby showing more of the tie and allowing space to add a button) are significantly different.

Further, how many other images out there could be so similar to the AP photo? Frankly, it’s not the most unique composition, and thousands of photographs are taken of candidates on the campaign trail.

Nevertheless, our task of interpretation is reduced substantially, because the parties agree, to some extent.

The question we must answer, then, is whether subsequent modifications transformed the scanned photograph into something that was no longer a photograph.

There is no doubt, noticeable alterations to the image from original photo. Arguably these changes have transformed the image from a photograph into an illustration based on a photograph.

Viewing the problem through this lens, we conclude that the alterations made failed to destroy the essentially photographic quality of the image.

Changes in color alone do not render an image any less photographic, but here the addition of posterization has produced an effect such that at first glance it is unclear how the image was created.

The question, however, is not whether the image is readily recognizable as a photograph standing alone. To evaluate the degree of accurate, lifelike detail an image contains, we must necessarily compare it to the original.

Once we do this, all doubts disappear. The precise shapes, their positions, their spatial relationship to each other–all remain perfectly distinct and identical to the original.

Despite the differences in appearance, no one familiar with the original can fail to recognize this. The image thus remains essentially what it was the moment it was transferred to the poster: a photographic reproduction. It is now a filtered, posterized reproduction–but photographic nonetheless.

We find that the use of the photo was an unauthorized use and therefore infringes copyright. We REVERSE and REMAND for a determination of damages.

http://bulk.resource.org/courts.gov/c/F3/207/207.F3d.1119.98-16061.html

The AP might just see the chance for a quick buck, but I think it more likely that they want to intimidate other artists who might be thinking of doing something similar.