This article from the New York Times, Fair Use, Art, Swiss Cheese and Me by lawyer, Michael Raps, is, I believe, a cogent argument for what constitutes copyright infringement in the US.
Most photographers would be aware that French photographer, Patrick Cariou, is sueing artist, Richard Prince, for copyright infringement, having had 35 of his images appropriated and altered. The case is presently before the US Court of Appeals for the Second Circuit.
I must confess that when I first read about the case a year or so ago, my instinctive sympathies (without having seen Mr Prince's work), were with Mr Cariou. However, once I saw Mr Prince's images I really did wonder what the fuss was about - not only are they clearly altered and decontextualised, but the markets for the altered and unaltered images are pretty much mutually exclusive.
I wonder what other photographic artists think?