Scope of exclusive rights in sound recordings: This limits the powers of clauses (1) and (2) of section 106. Unfortunately, it doesn't limit them to the point where AMVs are in the clear:
If you don't edit the audio and just encode it with some reasonably modern compression scheme, you still violate section 106, section 1. If you have edited your AMV's audio, you still violate section 106, section 2.clause (1) of section 106 is limited to the right to duplicate the sound recording in the form of phonorecords or copies that directly or indirectly recapture the actual sounds fixed in the recording. The exclusive right of the owner of copyright in a sound recording under clause (2) of section 106 is limited to the right to prepare a derivative work in which the actual sounds fixed in the sound recording are rearranged, remixed, or otherwise altered in sequence or quality.
Public performance is also addressed by (c). Part (d) is where it gets interesting, but only for the .org, not the AMV maker.
Sections 115 through 122 do not apply. If you disagree, cite sections and parts in those sections that may make them relevant.
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5. Because of (1) and (2), we have to get into this copyright mess. By (1) and (3), violation of copyright holders' exclusive rights has occurred (especially with regards to anime). By (4), we are not covered by any exemption. Thus, we have a violation of copyright law.
There are ways around this. Some record labels such as Magnatune allow non-commercial derivative works of their music, so long as you purchase a copy of that music from them first, which is one solution the music component of the problem. If you can obtain the necessary rights to visual sources (say, by making it yourself or other means) then you are completely in the clear.
I can't think of any AMV which has done both, though.
