Artist Shepard Fairey and the Associated Press confirmed Wednesday that they are settling out of court their legal case that involves Fairey's "Hope" poster depicting then-Sen. Barack Obama. But a lawyer for the AP added that the news organization is still pursuing its case against Obey Clothing, in which Fairey is a partner and that has reproduced the image on various items of clothing.

Fairey's poster of Obama was inspired by a photograph taken by an AP freelancer in 2006. The AP subsequently accused the Los Angeles artist of copyright infringement, with Fairey maintaining that it falls under fair-use laws.

A settlement means that the March trial between Fairey and the AP in New York will not take place. As part of their settlement, Fairey has agreed he will not use another AP photo in his work without obtaining a license from the news organization.

The two sides also have agreed to share the rights to make the posters and merchandise bearing the "Hope" image. In addition, Fairey and the AP have agreed to additional financial terms that are confidential.

"I am pleased to have resolved the dispute with the Associated Press," Fairey said in a statement. "I respect the work of photographers, as well as recognize the need to preserve opportunities for other artists to make fair use of photographic images. I often collaborate with photographers in my work, and I look forward to working with photos provided by the AP's talented photographers."