looks to be common grease filled die.... http://www.error-ref.com/struck-through-smooth-viscous-material-grease-oil/
Yep, common grease filled die error! Value? Sorry, only worth one cent, too much wear! Better luck next time!
There are only two ways that could have happened. One, they momentarily forgot how to spell LIBERTY in 1961, or two, what @ken454 and @fretboard said.
Well, based on the poll choices, that they forgot how to spell LIBERTY in 1961 should definitely have been a choice also. I would have voted for it.
If you understand the minting and die making processes, you'll understand that what you're claiming is not possible. It is likely caused by a debris filled die as other experienced collectors have mentioned. Also Notice that there is damage to the rim area which would account for the perceived lack of space. Hope this helps
Part of the L is there. It didn't take on the coin because it was obliterated with hard grease on the die. If we can see the whole coin, the heads and the tails, we can tell you why there's no room for it. It's either an unsecured planchet or a smaller one. It happens. Honest.
Plenty of room. A classic sign of overused dies (no value added) it the letters spread towards the rim. Even touching it.