On July 23, 2011, about 0752 eastern daylight time, a Champion 7ECA, N5191X, experienced a total loss of engine power after takeoff from the Midcoast Regional Airport (LHW), Hinesville, Georgia. The certificate private pilot sustained serious injuries and the passenger reported minor injuries. The airplane sustained substantial damage to the fuselage and wings. The airplane was registered to and operated by a private individual under the provisions of 14 Code of Federal Regulations Part 91 as a personal flight. Visual meteorological conditions prevailed and no flight plan was filed. The flight was originating at the time of the accident. The pilot reported the airplane had climbed to about 900 feet after takeoff when the engine experienced a total loss of engine power. He initiated a turn back towards the airport. During the approach to land, the airplane stalled and collided with an airport fence. Examination of the wreckage by a Federal Aviation Administration inspector revealed no anomalies with the airframe or flight controls. Examination of the carburetor revealed a large piece of foam from the air filter element was lodged in the carburetor venturi inlet. The FAA Inspector stated the air filter element had been installed improperly resulting in the foam element separating and being drawn into the carburetor inlet. Review of the airplane logbooks revealed an engine overhaul was completed 31 hours before the accident. According to the pilot, a Brackett Aero Filter air filter element was installed during the engine overhaul. Review of performance data for the Champion 7ECA revealed the airplane will stall at 44 knots.