iMovie 3.0.1: Cannot Import Audio CD Without Internet Connection

iMovie 3 may not allow you to import tracks from an audio CD if you do not have an active Internet connection.
Symptom

After inserting an audio CD, you cannot select the CD in the Audio pane of iMovie 3 (the option is dimmed). The CD appears in the Finder and is listed in iTunes with the generic name "Audio CD".

Solution

Import the audio CD into iTunes. You should then be able to import the audio into your iMovie 3 project using the iTunes Library pop-up in the iMovie Audio pane.
Published Date: Feb 18, 2012