Now that photographer certainly never would have been paid or even heard of had the photo been used as inspiration. Yet, Fairey lost that case in Federal Court.
People are prevented from using a photograph of someones face to remix into a vectorized, colorized, cartoonized version of this face. A photo that would have died a quiet death as a newsroom archive. It is my opinion that Fairey's usage did nothing but add to our collective culture and that preventing use like this in the future is quite chilling for creatives of many fields. (For more on this topic, written much more eloquently see: http://waxy.org/2011/06/kind_of_screwed/)
What happens when a company does a 3D scan of Briteny Spears and produces a model of every muscle movement possible, and then claims copyright over every single photograph and drawing of Ms. Spears that every gets produces hereafter? We already see a similar tactic being used with patent trolls, "patent everything, sue everyone."
The problem with this is that when EMI or some other record giant is the one being abusive and submitting bogus claims, Youtube/SC/et all will not start ignoring notices because they will be afraid that the label will pull their catalog.