A press release from the Kurow Museum in August heavily implied Mr Paterson was creating the sculpture and contained quotes from him including: ``For me to be creating this sculpture is a real honour; just fantastic.''
Subsequent unchallenged reports updated Mr Paterson's plans for the effigy of the former All Black captain, to be erected in his hometown of Kurow.
But Kurow Museum Committee chairman Bob Watherston this week confirmed he had told Mr Paterson he had not been given the job.
Mr Watherston said the committee considered a list of names of sculptors and eliminated the ones they didn't want, which was when Mr Paterson's name was eliminated. Mr Watherston told the sculptor of the decision in February.
When a mock-up of Mr Paterson's proposed statue, produced to work out proportions and stance, was released late last year it drew heavy criticism from social media commentators.
Mr Watherston said Mr Paterson was disappointed about not getting the job, but there was no signed contract at that point, so no obligation on the museum's part.
``We were very inspired, but we had to cast the net fairly wide.
``When you go to get sponsorship you have to show you're diligent in your research.''
Mr Watherston said a new artist had been signed on to create the statue, but refused to say who that was or discuss the project any further.
When contacted, Mr Paterson declined to comment.
In November it was announced the statue would be built at Hydro Pl in Kurow near the intersection of State Highways 83 and 82.
Fundraising had secured about $20,000, but the committee had set a target of around $120,000 for the statue.
