OK, then My quick-and-dirty immediate reaction would be to obtain a replacement penny with the exact same year, go to the effort of purchasing a modeler's spraypaint gun and aluminum colouring from a hobby shop, and quickly paint the replacement item the correct colour with the aluminum paint and then challenge the feds to prove it to be not the same one originally photographed. As long as it looks the same, they can not prove it to be anything other than was originally photographed without physical possession of an item incontrovertably proven to be the item originally photographed.
Make them WORK to prove it is false.
The question is does the government want the coin or the money?. I would offer to have the government relinquish their claim for 50% of the auction price and send the coin to auction with a clear title. The government gets 1/2 of the sale and another 1/3 of the proceeds to Lawrence in income tax.