Lynch attended the ceremony with actress Emily Stofle
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The acclaimed US film-maker David Lynch has been awarded France's top civilian honour, the Legion d'Honneur.
Lynch is famed for productions such as The Elephant Man and Mulholland Drive, plus cult hit TV series Twin Peaks.
French President Nicolas Sarkozy hailed his eclectic "genius". Lynch replied in halting French: "My French is poor, but my heart is rich today thanks to you."
France also honoured The Police by making the rock group's members knights of the Order of Arts and Letters.
Lynch has film credits including work as a director, writer, producer, actor, cinematographer and composer.
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It's no secret that I love France, the art-making, art-loving and art-supporting people of France
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He was also nominated for four Oscars - twice for The Elephant Man and once each for Mulholland Drive and Blue Velvet.
Lynch was accompanied by his partner, actress Emily Stofle, and was flanked at the ceremony by director Roman Polanski, plus actresses Fanny Ardant and Charlotte Rampling.
"It's no secret that I love France, the art-making, art-loving and art-supporting people of France," he said.
Mr Sarkozy told the director that seeing Elephant Man as a teenager had "definitively convinced" him that "cinema was a highly important matter".
Sting said it was "very exotic" to be made a "chevalier", or a knight
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The Police's three members - Sting, Andy Summers and Stewart Copeland - were given their honours by Christine Albanel, the French culture minister.
She praised the group, who were hugely successful during the 1980s, for the "new sound" that they generated and expressed "France's full admiration and recognition" for the band's music.
"We are very touched because we deeply admire French culture," Sting told reporters in French, following the brief ceremony at the culture ministry in Paris.
The band have reunited for a world tour and played to nearly 80,000 fans at a stadium north of Paris at the weekend.
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