Ed, not all statutory rights need be addressed the same way.



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From: Edward Morris
Sent: Saturday, October 03, 2015 05:22:50 AM
To: Arun Sukumar
Cc: Seun Ojedeji; ICANN@adlercolvin.com; thomas@rickert.net; accountability-cross-community@icann.org; ACCT-Staff; Sidley ICANN CCWG
Subject: Re: [CCWG-ACCT] Documents for Posting for CCWG-ACCT

Arun,

This is a well intentioned nonstarter. Take for example derivative rights, that is the right to sue the corporation on behalf of the corporation for gross malfeasance. To include the Board in the decision would be to ask the Board whether it wishes to sue itself on behalf of itself.  If we get to that point we need to find a corporate psychologist. One ideally should not sue oneself. Or document rights. Dear Board, you refused to allow us to inspect documents whose contents would help us in an IRP action we have against you. Would you please join us in ruling against yourself?

For the record, I like the statutory rights. They are the most potent accountability mechanisms available to us, would probably rarely if ever be used but their existence would help ensure compliance with 'lesser' mechanisms and are a normal part of nonprofit corporate governance. The further away we get from tried and true governance principles enshrined in statutory law, full of legal precedence and authority, the riskier the proposal.

Best,

Ed Morris

Sent from my iPhone

On Oct 3, 2015, at 10:58 AM, Arun Sukumar <arun.sukumar@nludelhi.ac.in> wrote:

Hit send too early. This paragraph is most interesting. Shared governance is of course a political concept, but would involving the Board on specific decisions not violate the SoP principle that Kavouss and others have rightly highlighted? Would it hold water in California courts?
 
Just as an example, the Bylaws could provide that all SOs and ACs must approve specific decisions in order for the community to direct the Sole Member with respect to the unwanted statutory right. This could even include involving the Board of Directors (for example with a trigger right, or an approval or veto right) with respect to dissolution and other statutory rights of concern. The goal of such an approach would be to assure shared as opposed to unilateral governance of specifically identified critical decisions

On Sat, Oct 3, 2015 at 3:25 PM, Arun Sukumar <arun.sukumar@nludelhi.ac.in> wrote:
Just as an example, the Bylaws could provide that all SOs and ACs must approve specific decisions in order for the community to direct the Sole Member with respect to the unwanted statutory right. This could even include involving the Board of Directors (for example with a trigger right, or an approval or veto right) with respect to dissolution and other statutory rights of concern. The goal of such an approach would be to assure shared as opposed to unilateral governance of specificallyidentified critical decisions

On Sat, Oct 3, 2015 at 12:54 PM, Seun Ojedeji <seun.ojedeji@gmail.com> wrote:

Hello Gregory,

This is quite helpful memo, I particularly like the text below:

"...Level 2: A consensus among all participating SOs and ACs (based on the Level 1 decisions of each participant) is then required to meet whatever decision threshold for a particular matter has been set in the Bylaws; it is at this level, Level 2, where it is entirely lawful to
impose severe limits on the ability to direct the Sole Member with respect to any statutory rights that are of concern.."

Will be good to know how this will work with ACs especially if votes is used to gauge consensus (this ofcourse is not a legal question)

Regards

Sent from my Asus Zenfone2
Kindly excuse brevity and typos.

On 2 Oct 2015 20:39, "Gregory, Holly" <holly.gregory@sidley.com> wrote:

Thomas, Mathieu and Leon and CCWG,,

 In addition to slides comparing the Sole Member, Sole Designator and Board Proposal from last week (which we understand did not get posted yet) , we are providing a memo as requested in LA that discusses how the statutory rights of a member can be constrained in the Sole Member model. 

Kind regards, Holly and Rosemary

 

 

HOLLY GREGORY
Partner

Sidley Austin LLP
+1 212 839 5853
holly.gregory@sidley.com

 

 

 

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