Greetings, As we approach ICANN Dublin I have been asked by some of my ccTLD colleagues to set out clearly why as a ccTLD manager I support the Board proposals for improving ICANN's accountability as part of the transition. In essence for me it’s all about time. I believe that we, the community, can get the enhanced accountability we want now without the need for wholesale structural change. I'm not against change or indeed any of the models being proposed but I am against making such changes without carefully considering them over time. There is a significant amount of work to be done before deciding to make such important structural changes and all of that will take time and more research and stress testing and unforeseen consequence analysis and impact analysis. In essence the Board has supported the CCWG’s proposed fundamental bylaws and the binding IRP and has suggested that there be a Community IRP and a further fundamental bylaw setting in place an ongoing improvement mechanism that will allow the community to take the necessary time to consider the structural changes and to have confidence that the proposals arising from such a process will be implemented. I believe that the Community IRP does provide the community with the rights it seeks and that it can be implemented in a timeframe that does not jeopardise the transition. The Community IRP is an independent arbitration process for hearing community claims that the Board has acted outside of its by-laws. Under the process there is a legally enforceable and contractual obligation on ICANN to comply with a decision of the arbitration panel. I believe that the community find ourselves in our current difficult situation because, with the best of intentions, the CCWG’s attorneys have been instructed to come up with models that deliver ‘the highest possible levels of enforcement’. It is not that the Community IRP cannot deliver the enhanced accountability that we want but rather that it is perceived, by some, as inadequate because there is a different mechanism that delivers a higher level of enforceability. The CCWG appears to be requiring a mechanism that allows the community (in whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty. I firmly believe in the corporate governance structures adopted by most corporate bodies around the world. Board members are appointed to manage the affairs of the organisation on the understanding that they are legally bound to act in the best interests of the organization rather than any one member or community. Such best interests are set out in the by-laws - in ICANN's case for example, the security and stability of the Internet as a whole. The Board has a fiduciary obligations to act in that way. The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right. The alternative, it seems to me, is to create, now, a system where fiduciary duty is abandoned and the will of the community holds sway. That is in effect what happens under the membership model as described by the CCWG’s attorneys. This may well be acceptable in the future when all of the nuances have been thought through and the necessary community conflicts and ethics rules, accountability mechanisms and disclosure requirements have been agreed. But it will take time and testing and a fuller discussion. Fiduciary responsibilities and duties are there for a reason. I think that some in the community feel that the Board and ICANN legal sometimes use the ‘cloak’ of fiduciary responsibility to avoid doing what the community wants. Whilst I don’t believe that is true I do empathise with the feeling. To my mind the solution (at least at this time during the transition) is NOT to create a mechanism under which fiduciary duty is held by no one but rather to create a mechanism where the community can test the Board's claims about such duty. The Community IRP as suggested by the Board does just that. I want to stress again that I am not against any of the proposed models put forward by the CCWG. But I can't agree the models at this stage because I don’t believe we have enough detail and I think the community as a whole should take their time in considering making such important changes. And I do not agree with those who claim that "we must do it now because it's our only chance". I am very much looking forward to spending time with my ccTLD colleagues during the Dublin meeting and hope we will have the opportunity to talk, and not just about the transition. Cheers, Chris Disspain | Chief Executive Officer .au Domain Administration Ltd T: +61 3 8341 4111 | F: +61 3 8341 4112 E: ceo@auda.org.au <mailto:ceo@auda.org.au> | W: www.auda.org.au <http://www.auda.org.au/> auDA – Australia’s Domain Name Administrator Important Notice - This email may contain information which is confidential and/or subject to legal privilege, and is intended for the use of the named addressee only. If you are not the intended recipient, you must not use, disclose or copy any part of this email. If you have received this email by mistake, please notify the sender and delete this message immediately. Please consider the environment before printing this email.
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
Just a small stress-test on this: let's say that ICANN is behaving so erratically that the community asked for ICANN to dissolve itself. Board refuses, community goes to Community IRP and prevails. Board then refuses again, saying that fiduciary duties to the corporation prevent them from implementing that decision... when this matter goes to court, a court may say that the articles of incorporation indeed prevent the board from dissolving the company, no matter any reasoning to the contrary. The court might not have latitude to tell ICANN to do otherwise even if the court agrees with both the community and the IRP panel. Rubens
Good point Rubens: We have to stress test even the " non-structural " proposals for consistency. So much for time savings. Carlos Raúl On Oct 11, 2015 10:31 AM, "Rubens Kuhl" <rubensk@nic.br> wrote:
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
Just a small stress-test on this: let's say that ICANN is behaving so erratically that the community asked for ICANN to dissolve itself. Board refuses, community goes to Community IRP and prevails. Board then refuses again, saying that fiduciary duties to the corporation prevent them from implementing that decision... when this matter goes to court, a court may say that the articles of incorporation indeed prevent the board from dissolving the company, no matter any reasoning to the contrary. The court might not have latitude to tell ICANN to do otherwise even if the court agrees with both the community and the IRP panel.
Rubens
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On Oct 11, 2015, at 1:48 PM, Carlos Raul <carlosraulg@gmail.com> wrote:
Good point Rubens:
We have to stress test even the " non-structural " proposals for consistency. So much for time savings.
I would say that there are no scenarios that with no structural changes; even the scenario with no membership or designator is a significant structural change from current ICANN, due to the removal of NTIA. It's also just as untested as any of the incarnations of the CCWG proposed models... ... but I was pleased to see that Chris Disspain refrained from making such arguments, so let's hope that Board keeps arguing in this more constructive way. The "ICANN will die" FUD is what usually comes along with labelling the changes "structural". Rubens
@Rubens +1 Carlos Raúl Gutiérrez ISOC Costa Rica Chapter skype carlos.raulg +506 8837 7176 (New Phone number!!!!) ________ Apartado 1571-1000 COSTA RICA On Sun, Oct 11, 2015 at 11:25 AM, Rubens Kuhl <rubensk@nic.br> wrote:
On Oct 11, 2015, at 1:48 PM, Carlos Raul <carlosraulg@gmail.com> wrote:
Good point Rubens:
We have to stress test even the " non-structural " proposals for consistency. So much for time savings.
I would say that there are no scenarios that with no structural changes; even the scenario with no membership or designator is a significant structural change from current ICANN, due to the removal of NTIA. It's also just as untested as any of the incarnations of the CCWG proposed models...
... but I was pleased to see that Chris Disspain refrained from making such arguments, so let's hope that Board keeps arguing in this more constructive way. The "ICANN will die" FUD is what usually comes along with labelling the changes "structural".
Rubens
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Hello, I will like to hear how the scenario you indicated below will be different if it were SM model? Please bear in mind that board still have fiduciary responsibilities in both cases. On a lighter note, is it not interesting(unfortunate) that self destruct scenarios is one the factors informing our proposal. Regards Sent from my Asus Zenfone2 Kindly excuse brevity and typos. On 11 Oct 2015 17:31, "Rubens Kuhl" <rubensk@nic.br> wrote:
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
Just a small stress-test on this: let's say that ICANN is behaving so erratically that the community asked for ICANN to dissolve itself. Board refuses, community goes to Community IRP and prevails. Board then refuses again, saying that fiduciary duties to the corporation prevent them from implementing that decision... when this matter goes to court, a court may say that the articles of incorporation indeed prevent the board from dissolving the company, no matter any reasoning to the contrary. The court might not have latitude to tell ICANN to do otherwise even if the court agrees with both the community and the IRP panel.
Rubens
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Hi, It is interesting. I don not think it was on the CCWG horizon until the Board brought it up as a consideration for the SM. We have since had extensive discussions on the fact that this power already exists in the Board's hands. We have also gotten advice that issues like this can be locked down in the SM model with bylaws requirement like: - must be triggered by the Board to even be considered - requires full consensus. I think the test both for closing the doors and for rejecting the closure of the doors can easily be covered for the SM model. Of course we have to formally discuss and agree upon measures for fixing the gaps in the SM model. We are still in the pre-discussion about whether and how to have the discussion. Now that is interesting. avri On 11-Oct-15 12:48, Seun Ojedeji wrote:
Hello,
I will like to hear how the scenario you indicated below will be different if it were SM model? Please bear in mind that board still have fiduciary responsibilities in both cases.
On a lighter note, is it not interesting(unfortunate) that self destruct scenarios is one the factors informing our proposal.
Regards
Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 11 Oct 2015 17:31, "Rubens Kuhl" <rubensk@nic.br <mailto:rubensk@nic.br>> wrote:
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
Just a small stress-test on this: let's say that ICANN is behaving so erratically that the community asked for ICANN to dissolve itself. Board refuses, community goes to Community IRP and prevails. Board then refuses again, saying that fiduciary duties to the corporation prevent them from implementing that decision... when this matter goes to court, a court may say that the articles of incorporation indeed prevent the board from dissolving the company, no matter any reasoning to the contrary. The court might not have latitude to tell ICANN to do otherwise even if the court agrees with both the community and the IRP panel.
Rubens
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Hi Avri, I was waiting for someone to highlight how that plays in the SM so one could perhaps identity the differences (if any). Based on your response, it therefore seem that in both cases the court will rule in favour of the group with fiduciary duty (which is the board in both cases). Thanks Sent from my Asus Zenfone2 Kindly excuse brevity and typos. On 11 Oct 2015 18:28, "Avri Doria" <avri@acm.org> wrote:
Hi,
It is interesting. I don not think it was on the CCWG horizon until the Board brought it up as a consideration for the SM. We have since had extensive discussions on the fact that this power already exists in the Board's hands. We have also gotten advice that issues like this can be locked down in the SM model with bylaws requirement like:
- must be triggered by the Board to even be considered - requires full consensus.
I think the test both for closing the doors and for rejecting the closure of the doors can easily be covered for the SM model.
Of course we have to formally discuss and agree upon measures for fixing the gaps in the SM model. We are still in the pre-discussion about whether and how to have the discussion. Now that is interesting.
avri
On 11-Oct-15 12:48, Seun Ojedeji wrote:
Hello,
I will like to hear how the scenario you indicated below will be different if it were SM model? Please bear in mind that board still have fiduciary responsibilities in both cases.
On a lighter note, is it not interesting(unfortunate) that self destruct scenarios is one the factors informing our proposal.
Regards
Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 11 Oct 2015 17:31, "Rubens Kuhl" <rubensk@nic.br <mailto:rubensk@nic.br>> wrote:
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
Just a small stress-test on this: let's say that ICANN is behaving so erratically that the community asked for ICANN to dissolve itself. Board refuses, community goes to Community IRP and prevails. Board then refuses again, saying that fiduciary duties to the corporation prevent them from implementing that decision... when this matter goes to court, a court may say that the articles of incorporation indeed prevent the board from dissolving the company, no matter any reasoning to the contrary. The court might not have latitude to tell ICANN to do otherwise even if the court agrees with both the community and the IRP panel.
Rubens
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Hi, I do not see that at all. I think the SM offers a model by which it is done cooperatively if it is done at all and does not include the courts unless either of them decides to act unilaterally. avri On 11-Oct-15 13:53, Seun Ojedeji wrote:
Hi Avri,
I was waiting for someone to highlight how that plays in the SM so one could perhaps identity the differences (if any). Based on your response, it therefore seem that in both cases the court will rule in favour of the group with fiduciary duty (which is the board in both cases).
Thanks
Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 11 Oct 2015 18:28, "Avri Doria" <avri@acm.org <mailto:avri@acm.org>> wrote:
Hi,
It is interesting. I don not think it was on the CCWG horizon until the Board brought it up as a consideration for the SM. We have since had extensive discussions on the fact that this power already exists in the Board's hands. We have also gotten advice that issues like this can be locked down in the SM model with bylaws requirement like:
- must be triggered by the Board to even be considered - requires full consensus.
I think the test both for closing the doors and for rejecting the closure of the doors can easily be covered for the SM model.
Of course we have to formally discuss and agree upon measures for fixing the gaps in the SM model. We are still in the pre-discussion about whether and how to have the discussion. Now that is interesting.
avri
On 11-Oct-15 12:48, Seun Ojedeji wrote: > > Hello, > > I will like to hear how the scenario you indicated below will be > different if it were SM model? Please bear in mind that board still > have fiduciary responsibilities in both cases. > > On a lighter note, is it not interesting(unfortunate) that self > destruct scenarios is one the factors informing our proposal. > > Regards > > Sent from my Asus Zenfone2 > Kindly excuse brevity and typos. > > On 11 Oct 2015 17:31, "Rubens Kuhl" <rubensk@nic.br <mailto:rubensk@nic.br> > <mailto:rubensk@nic.br <mailto:rubensk@nic.br>>> wrote: > >> The ICANN Board has proposed the Community IRP as binding >> arbitration. The CCWG’s attorneys have said that the Board can >> refuse to implement such a binding arbitration decision if it >> claims that to implement it would be a breach of its obligations >> to act in the best interests of ICANN. This is true BUT the >> community representatives can then go to court and a court will >> enforce the arbitration decision if it disagrees with the Board's >> view. In my opinion this is precisely the type of safeguard we >> need to have in place because it ensures that an elected board >> made up of representatives of the multi-stakeholder community >> will always act, first, in the interests of a stable and secure >> Internet and it puts in place an independent arbiter to decide, >> in the final analysis, if the community or the board is right. >> >> > > Just a small stress-test on this: let's say that ICANN is behaving > so erratically that the community asked for ICANN to dissolve > itself. Board refuses, community goes to Community IRP and > prevails. Board then refuses again, saying that fiduciary duties > to the corporation prevent them from implementing that decision... > when this matter goes to court, a court may say that the articles > of incorporation indeed prevent the board from dissolving the > company, no matter any reasoning to the contrary. The court might > not have latitude to tell ICANN to do otherwise even if the court > agrees with both the community and the IRP panel. > > > Rubens > > > > > > _______________________________________________ > Accountability-Cross-Community mailing list > Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org> > <mailto:Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org>> > https://mm.icann.org/mailman/listinfo/accountability-cross-community > > > > _______________________________________________ > Accountability-Cross-Community mailing list > Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org> > https://mm.icann.org/mailman/listinfo/accountability-cross-community
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Hello Avri, Not sure I get why you awarded accolades to SM in this instance, Isn't collaboration(doing things cooperatively) based on set of guidelines possible in any model including SM? Both parties will end up in courts when/if either of the parties does not follow the set guideline. (although it's usually checking board compliance and not that of the community as it's assumed community usually complies) In my opinion I think the more we introduce community powers that conflicts with board's fiduciary duties, the more likelihood of visiting the courts. That said, going to courts is not something that board or community wants to be doing and its important to setup as much dialogue possibilities between the duo before heading to courts. I would say a lot would have gone wrong by the time we get to the stage where community and board are heading to courts. Regards Sent from my Asus Zenfone2 Kindly excuse brevity and typos. On 11 Oct 2015 19:48, "Avri Doria" <avri@acm.org> wrote:
Hi,
I do not see that at all. I think the SM offers a model by which it is done cooperatively if it is done at all and does not include the courts unless either of them decides to act unilaterally.
avri
On 11-Oct-15 13:53, Seun Ojedeji wrote:
Hi Avri,
I was waiting for someone to highlight how that plays in the SM so one could perhaps identity the differences (if any). Based on your response, it therefore seem that in both cases the court will rule in favour of the group with fiduciary duty (which is the board in both cases).
Thanks
Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 11 Oct 2015 18:28, "Avri Doria" <avri@acm.org <mailto:avri@acm.org>> wrote:
Hi,
It is interesting. I don not think it was on the CCWG horizon until the Board brought it up as a consideration for the SM. We have since had extensive discussions on the fact that this power already exists in the Board's hands. We have also gotten advice that issues like this can
be
locked down in the SM model with bylaws requirement like:
- must be triggered by the Board to even be considered - requires full consensus.
I think the test both for closing the doors and for rejecting the closure of the doors can easily be covered for the SM model.
Of course we have to formally discuss and agree upon measures for fixing the gaps in the SM model. We are still in the pre-discussion about whether and how to have the discussion. Now that is interesting.
avri
On 11-Oct-15 12:48, Seun Ojedeji wrote: > > Hello, > > I will like to hear how the scenario you indicated below will be > different if it were SM model? Please bear in mind that board still > have fiduciary responsibilities in both cases. > > On a lighter note, is it not interesting(unfortunate) that self > destruct scenarios is one the factors informing our proposal. > > Regards > > Sent from my Asus Zenfone2 > Kindly excuse brevity and typos. > > On 11 Oct 2015 17:31, "Rubens Kuhl" <rubensk@nic.br <mailto:rubensk@nic.br> > <mailto:rubensk@nic.br <mailto:rubensk@nic.br>>> wrote: > >> The ICANN Board has proposed the Community IRP as binding >> arbitration. The CCWG’s attorneys have said that the Board can >> refuse to implement such a binding arbitration decision if it >> claims that to implement it would be a breach of its obligations >> to act in the best interests of ICANN. This is true BUT the >> community representatives can then go to court and a court
will
>> enforce the arbitration decision if it disagrees with the Board's >> view. In my opinion this is precisely the type of safeguard we >> need to have in place because it ensures that an elected board >> made up of representatives of the multi-stakeholder community >> will always act, first, in the interests of a stable and
secure
>> Internet and it puts in place an independent arbiter to
decide,
>> in the final analysis, if the community or the board is right. >> >> > > Just a small stress-test on this: let's say that ICANN is behaving > so erratically that the community asked for ICANN to dissolve > itself. Board refuses, community goes to Community IRP and > prevails. Board then refuses again, saying that fiduciary
duties
> to the corporation prevent them from implementing that decision... > when this matter goes to court, a court may say that the articles > of incorporation indeed prevent the board from dissolving the > company, no matter any reasoning to the contrary. The court might > not have latitude to tell ICANN to do otherwise even if the court > agrees with both the community and the IRP panel. > > > Rubens > > > > > > _______________________________________________ > Accountability-Cross-Community mailing list > Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org> > <mailto:Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org>> >
https://mm.icann.org/mailman/listinfo/accountability-cross-community
> > > > _______________________________________________ > Accountability-Cross-Community mailing list > Accountability-Cross-Community@icann.org <mailto:Accountability-Cross-Community@icann.org> >
https://mm.icann.org/mailman/listinfo/accountability-cross-community
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On 11-Oct-15 15:22, Seun Ojedeji wrote:
Not sure I get why you awarded accolades to SM in this instance, Isn't collaboration(doing things cooperatively) based on set of guidelines possible in any model including SM?
Court is always there at the end of the day. I just think that a model built on cooperation and consensus (a non voting SM) is less likely to end up in court than a model that starts with adversarial behavior - arbitration and mediation. A well formed SM model builds on a combination, a hand-fasting, of the Board's fiduciary roles and responsibilities with the Community's roles and responsibility to represent the interests of the public as best they can though the bylaws processes and outreach. They both check each other and both can be appealed to the IRP when they go off the rails. avri --- This email has been checked for viruses by Avast antivirus software. https://www.avast.com/antivirus
Avri I am not in favour of adversarial act.'if we do every thing on consensus basis,and achieve our objectives why we gigot with Board? Kavouss Sent from my iPhone
On 11 Oct 2015, at 21:38, Avri Doria <avri@acm.org> wrote:
On 11-Oct-15 15:22, Seun Ojedeji wrote: Not sure I get why you awarded accolades to SM in this instance, Isn't collaboration(doing things cooperatively) based on set of guidelines possible in any model including SM?
Court is always there at the end of the day. I just think that a model built on cooperation and consensus (a non voting SM) is less likely to end up in court than a model that starts with adversarial behavior - arbitration and mediation.
A well formed SM model builds on a combination, a hand-fasting, of the Board's fiduciary roles and responsibilities with the Community's roles and responsibility to represent the interests of the public as best they can though the bylaws processes and outreach. They both check each other and both can be appealed to the IRP when they go off the rails.
avri
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Hi, I am in complete agreement. I hope we can find solutions that make adversarial interactions as improbable as possible. avri On 11-Oct-15 16:13, Kavouss Arasteh wrote:
Avri I am not in favour of adversarial act.'if we do every thing on consensus basis,and achieve our objectives why we gigot with Board? Kavouss
Sent from my iPhone
On 11 Oct 2015, at 21:38, Avri Doria <avri@acm.org> wrote:
On 11-Oct-15 15:22, Seun Ojedeji wrote: Not sure I get why you awarded accolades to SM in this instance, Isn't collaboration(doing things cooperatively) based on set of guidelines possible in any model including SM? Court is always there at the end of the day. I just think that a model built on cooperation and consensus (a non voting SM) is less likely to end up in court than a model that starts with adversarial behavior - arbitration and mediation.
A well formed SM model builds on a combination, a hand-fasting, of the Board's fiduciary roles and responsibilities with the Community's roles and responsibility to represent the interests of the public as best they can though the bylaws processes and outreach. They both check each other and both can be appealed to the IRP when they go off the rails.
avri
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For the record, I don't think MEM is perfect (and may never be) but it's more apealing to me considering that it's the only proposal that leaves structures untouched as much as possible (SD is also somewhat appealing as well, owning to the fact that some powers can't be directly exercised and require minimal structural change). May I know why you think the MEM for instance starts with arbitration and mediation? I am also in absolute agreement with a model built on cooperation and consensus, as I have usually raise that as a preference in some of my mails. However, I am also faced with the reality that when options gets exhausted a show of hand will usually come to be a last option to gauge consensus and I doubt we won't be exhausting our options often. That said, what is not clear is that you seem to imply that the SM model will achieve that better than any other model. As you rightly stated, isn't it finally about what is documented in the guideline (bylaw)? Regards Sent from my Asus Zenfone2 Kindly excuse brevity and typos. On 11 Oct 2015 20:38, "Avri Doria" <avri@acm.org> wrote:
On 11-Oct-15 15:22, Seun Ojedeji wrote:
Not sure I get why you awarded accolades to SM in this instance, Isn't collaboration(doing things cooperatively) based on set of guidelines possible in any model including SM?
Court is always there at the end of the day. I just think that a model built on cooperation and consensus (a non voting SM) is less likely to end up in court than a model that starts with adversarial behavior - arbitration and mediation.
A well formed SM model builds on a combination, a hand-fasting, of the Board's fiduciary roles and responsibilities with the Community's roles and responsibility to represent the interests of the public as best they can though the bylaws processes and outreach. They both check each other and both can be appealed to the IRP when they go off the rails.
avri
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Hi, Doesn't MEM create an entirely new, somewhat complicated, new appeals mechanism that includes binding arbitration, something we still are not sure works between a corporation and non-persons, like ACSOs. I am currently trying to understand whether the various AC/SO/SG/C/RALO/... would be well advised to become unincorporated associations in order to be able to take advantage of the MEM and subsequent court opportunities, if that solution is imposed. avri On 11-Oct-15 20:44, Seun Ojedeji wrote:
For the record, I don't think MEM is perfect (and may never be) but it's more apealing to me considering that it's the only proposal that leaves structures untouched as much as possible (SD is also somewhat appealing as well, owning to the fact that some powers can't be directly exercised and require minimal structural change). May I know why you think the MEM for instance starts with arbitration and mediation?
I am also in absolute agreement with a model built on cooperation and consensus, as I have usually raise that as a preference in some of my mails. However, I am also faced with the reality that when options gets exhausted a show of hand will usually come to be a last option to gauge consensus and I doubt we won't be exhausting our options often. That said, what is not clear is that you seem to imply that the SM model will achieve that better than any other model. As you rightly stated, isn't it finally about what is documented in the guideline (bylaw)?
Regards
Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 11 Oct 2015 20:38, "Avri Doria" <avri@acm.org <mailto:avri@acm.org>> wrote:
On 11-Oct-15 15:22, Seun Ojedeji wrote: > Not sure I get why you awarded accolades to SM in this instance, Isn't > collaboration(doing things cooperatively) based on set of guidelines > possible in any model including SM?
Court is always there at the end of the day. I just think that a model built on cooperation and consensus (a non voting SM) is less likely to end up in court than a model that starts with adversarial behavior - arbitration and mediation.
A well formed SM model builds on a combination, a hand-fasting, of the Board's fiduciary roles and responsibilities with the Community's roles and responsibility to represent the interests of the public as best they can though the bylaws processes and outreach. They both check each other and both can be appealed to the IRP when they go off the rails.
avri
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Waiting to sure up th accountability process means that the NTIA, Board and general public will be able to claim that the process is broken and disband the process. With each day goes leverage to those who truly want to make ICANN just a basic corporation like Google, or a organization that can seem to be multiatakeholder but easily influenced behind the scenes, with a whistleblower process no different than your basic mega-corporation,. The strategy is to delay the entire process. They want to give something away for free? Bottom line: Its easier for oligarch system parading itself as a democracy to control something when their regulator, who currently has to file phony reports to the public once in a while about ICANN, no longer has to do that. Some people want you to work on chapters and chapters of work, deciding on this and that specific so you are so exhausted and therefore more accepting to accept having a post-transition board member calling up a shadowy whistleblower "phone number" to report that some corporation is intimidating the post-transition process, and that is IF that board member has any morality and courage to do so. Human nature folks, needs intelligent safeguards first then build within those safeguards. If they reject an external whistleblower process you know its a completley phony process and they arent the sweet angels they are claiming to be. Get in the game they are playing, they got all the biggest corporations on their team waiting to shut the public out behind the scenes while on the surface it appears to be "multistakeholder", just like the United States appears to be a democracy when it isnt. Ron
Resubmitting as it appears I got too many "bounces", not sure if my email was able to be transmitted: Waiting to sure up th accountability process means that the NTIA, Board and general public will be able to claim that the process is broken and disband the process. With each day goes leverage to those who truly want to make ICANN just a basic corporation like Google, or a organization that can seem to be multiatakeholder but easily influenced behind the scenes, with a whistleblower process no different than your basic mega-corporation,. The strategy is to delay the entire process. They want to give something away for free? Bottom line: Its easier for oligarch system parading itself as a democracy to control something when their regulator, who currently has to file phony reports to the public once in a while about ICANN, no longer has to do that. Some people want you to work on chapters and chapters of work, deciding on this and that specific so you are so exhausted and therefore more accepting to accept having a post-transition board member calling up a shadowy whistleblower "phone number" to report that some corporation is intimidating the post-transition process, and that is IF that board member has any morality and courage to do so. Human nature folks, needs intelligent safeguards first then build within those safeguards. If they reject an external whistleblower process you know its a completley phony process and they arent the sweet angels they are claiming to be. Get in the game they are playing, they got all the biggest corporations on their team waiting to shut the public out behind the scenes while on the surface it appears to be "multistakeholder", just like the United States appears to be a democracy when it isnt. Ron
"China asks world to impose 'code of conduct' on Internet" http://www.washingtonexaminer.com/china-asks-world-to-impose-code-of-conduct... I wonder if this article proves my entire external whistleblower argument, against outside influence. I think it does. Clearly governments with nation wide firewalls and censorship think they want to influence the process. Ron
"China asks world to impose 'code of conduct' on Internet" http://www.washingtonexaminer.com/china-asks-world-to-impose-code-of-conduct... I wonder if this article proves my entire external whistleblower argument, against outside influence. I think it does. Clearly governments with nation wide firewalls and censorship think they want to influence the process. Ron
Hi Chris Thank you for sharing your thinking with us on the current situation. I am sure you and others will be shocked to learn I have a slightly different take on things. To keep it brief, here are four points: *1. Why are we in our "current difficult situation"?* We are under time pressure because ICANN's Board and staff engaged in a process of delay and deferral that meant that the Accountability discussion didn't properly start until late November/early December 2014. Without that instinctive and disappointing response, we would have had a further ~ 6 months to work through these issues. The CCWG and those interested in improving ICANN's accountability aren't responsible for that situation, and nor are the CCWG's counsel. *2. Fiduciary duties are still owed.* In AUDA, or InternetNZ, our members (who have some rights of decision) don't owe the organisations they are part of fiduciary duties. Fiduciary duties are owed by the Board/Council to give effect to the organisation's mission and to exercise due judgement and care. *Absolutely nothing in the CCWG Proposal or any of the models under discussion changes that fiduciary responsibility on the Board.* There is absolutely nothing novel, disruptive or difficult with the idea that a stakeholder community organised as members don't owe such duties - that is the Board's job, because the Board governs the organisation. People who aren't on the Board can't realise such duties - they don't have the rights of decision, the access to information, and the leverage over the operational staff that a Board does. Conflating this argument in the way your email does is a regrettable tactic because it suggests something unusual is being proposed. That isn't the case. *3. Limited, carefully constrained powers are all anyone has suggested.* Nobody, the CCWG least of all, has suggested a fundamental restructure of ICANN. ICANN's multistakeholder policy process is the core of its activity. That wouldn't change with any of the models set out - not the Board's, not the CCWG's. All the CCWG has proposed are reserve accountability powers the Board says it supports - powers to guarantee community rights in respect of planning and budget documents, to appoint and remove directors, and to have a formal role in changes to ICANN's bylaws. Add on more effective dispute resolution and that's it. Significant progress is being made in the CCWG to make the decisional rights to exercise such powers more consistent with consensus multistakeholder decision-making. That work will hopefully be shared at Dublin. Whether such powers have a backstop of membership, or designator, or binding arbitration, the choice should rely on the objective merits of each approach and how far each one goes in meeting CWG and NTIA requirements. To repeat: *there is no massive restructuring in any of these models, and all the CCWG proposals have been thoroughly stress tested. It is the Board's MEM model that is the weakest in this regard, having been developed behind closed doors and not subject to rigorous stress testing. It is today the highest risk option on the table.* *4. Delaying key decisions isn't credible.* The history of accountability progress in ICANN has been of community pressure overcoming ICANN"s resistance to real change. That's not an unkind statement: it is just the only way to understand what actually happens (as opposed to the public arguments used to explain what people want to see happen). The CCWG's work has led to a substantive, careful, rigorously tested proposal to improve ICANN accountability, It has only been possible to get this done because of the dynamic created by the IANA Stewardship Transition. It is important that the community comes to a consensus around a proposal that creates a durable structure for accountability. I will assert this bluntly: if there isn't a workable and complete basic framework done now that provides for true accountability, once the transition is done such a settlement will *never* come about. The playing field would be forever tilted in the interests of the group with the most power and resources. That's ICANN - not the ICANN community. *In closing, I'd like to stress that the most important thing we can do is be up front and honest about what we do and don't support. * *I don't support the Board's MEM proposal* for the reasons set out above - it is untested and novel and hasn't been developed through a multistakeholder process. To validate it and think it through will delay this process and delay the transition. *I do support the CCWG's proposal*. It needs improvement but it is a genuine result of multistakeholder efforts, and after the community dialogue in Dublin we will know the remaining points of modification needed. *I could support, based on what I know today, a new synthesis* with no membership but careful use of designators and the revised community consensus decision-making the CCWG is developing. *All of these proposals need further refinement and the discussion has to go on until there is consensus. Until there is, nobody should try and finalise the proposal, because it'd be dead on arrival.* That's my starting position at the start of this pre-Dublin week. It would be good to know others'. In the end, we can only have an honest dialogue that leads to the sort of collaboration that can drive consensus if we *actually say what we think*, and acknowledge that the end point of the consensus process might absolutely not be what we individually want. Looking forward to seeing many of you soon! best Jordan On 12 October 2015 at 05:05, Chris Disspain <ceo@auda.org.au> wrote:
Greetings,
As we approach ICANN Dublin I have been asked by some of my ccTLD colleagues to set out clearly why as a ccTLD manager I support the Board proposals for improving ICANN's accountability as part of the transition.
In essence for me it’s all about time.
I believe that we, the community, can get the enhanced accountability we want now without the need for wholesale structural change. I'm not against change or indeed any of the models being proposed but I am against making such changes without carefully considering them over time. There is a significant amount of work to be done before deciding to make such important structural changes and all of that will take time and more research and stress testing and unforeseen consequence analysis and impact analysis.
In essence the Board has supported the CCWG’s proposed fundamental bylaws and the binding IRP and has suggested that there be a Community IRP and a further fundamental bylaw setting in place an ongoing improvement mechanism that will allow the community to take the necessary time to consider the structural changes and to have confidence that the proposals arising from such a process will be implemented.
I believe that the Community IRP does provide the community with the rights it seeks and that it can be implemented in a timeframe that does not jeopardise the transition. The Community IRP is an independent arbitration process for hearing community claims that the Board has acted outside of its by-laws. Under the process there is a legally enforceable and contractual obligation on ICANN to comply with a decision of the arbitration panel.
I believe that the community find ourselves in our current difficult situation because, with the best of intentions, the CCWG’s attorneys have been instructed to come up with models that deliver ‘the highest possible levels of enforcement’. It is not that the Community IRP cannot deliver the enhanced accountability that we want but rather that it is perceived, by some, as inadequate because there is a different mechanism that delivers a higher level of enforceability.
The CCWG appears to be requiring a mechanism that allows the community (in whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty.
I firmly believe in the corporate governance structures adopted by most corporate bodies around the world. Board members are appointed to manage the affairs of the organisation on the understanding that they are legally bound to act in the best interests of the organization rather than any one member or community. Such best interests are set out in the by-laws - in ICANN's case for example, the security and stability of the Internet as a whole. The Board has a fiduciary obligations to act in that way.
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
The alternative, it seems to me, is to create, now, a system where fiduciary duty is abandoned and the will of the community holds sway. That is in effect what happens under the membership model as described by the CCWG’s attorneys. This may well be acceptable in the future when all of the nuances have been thought through and the necessary community conflicts and ethics rules, accountability mechanisms and disclosure requirements have been agreed. But it will take time and testing and a fuller discussion.
Fiduciary responsibilities and duties are there for a reason. I think that some in the community feel that the Board and ICANN legal sometimes use the ‘cloak’ of fiduciary responsibility to avoid doing what the community wants. Whilst I don’t believe that is true I do empathise with the feeling. To my mind the solution (at least at this time during the transition) is NOT to create a mechanism under which fiduciary duty is held by no one but rather to create a mechanism where the community can test the Board's claims about such duty. The Community IRP as suggested by the Board does just that.
I want to stress again that I am not against any of the proposed models put forward by the CCWG. But I can't agree the models at this stage because I don’t believe we have enough detail and I think the community as a whole should take their time in considering making such important changes. And I do not agree with those who claim that "we must do it now because it's our only chance".
I am very much looking forward to spending time with my ccTLD colleagues during the Dublin meeting and hope we will have the opportunity to talk, and not just about the transition.
Cheers,
Chris Disspain | Chief Executive Officer
.au Domain Administration Ltd
T: +61 3 8341 4111 | F: +61 3 8341 4112
E: ceo@auda.org.au | W: www.auda.org.au
auDA – Australia’s Domain Name Administrator
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-- Jordan Carter Chief Executive *InternetNZ* +64-4-495-2118 (office) | +64-21-442-649 (mob) Email: jordan@internetnz.net.nz Skype: jordancarter Web: www.internetnz.nz *A better world through a better Internet *
On 12/10/2015 00:06, Jordan Carter wrote:
*In closing, I'd like to stress that the most important thing we can do is be up front and honest about what we do and don't support. *
_I don't support the Board's MEM proposal_ for the reasons set out above - it is untested and novel and hasn't been developed through a multistakeholder process. To validate it and think it through will delay this process and delay the transition.
I agree.
_I do support the CCWG's proposal_. It needs improvement but it is a genuine result of multistakeholder efforts, and after the community dialogue in Dublin we will know the remaining points of modification needed.
I agree.
_I could support, based on what I know today, a new synthesis_ with no membership but careful use of designators and the revised community consensus decision-making the CCWG is developing.
I'm not so sure. I don't think membership should be a matter of taste, it should be a question of whether it is required or beneficial to achieve our goals. There is currently a crucial question awaiting our Counsel's advice, Question 68 https://goo.gl/g0i64o This asks whether ICANN can be compelled to enter binding arbitration, on pain of forfeiting through a default judgement if it refuses to enter arbitration in a specific case. If the answer comes back as "no" (or less than a clear "yes"), then a membership model will be essential. The reason is that it will be necessary to ensure that someone has the capability to require ICANN to enter the IRP, as the Bylaws require it to do; only a member is capable of enforcing the bylaws through a derivative action. It is possible that there may be other reasons why membership is the only viable model. These should be considered and examined fairly. If membership is required, then we must not compromise. If we can do everything we need without it, then compromise can be entertained.
_All of these proposals need further refinement and the discussion has to go on until there is consensus. Until there is, nobody should try and finalise the proposal, because it'd be dead on arrival._
I agree. Malcolm. -- Malcolm Hutty | tel: +44 20 7645 3523 Head of Public Affairs | Read the LINX Public Affairs blog London Internet Exchange | http://publicaffairs.linx.net/ London Internet Exchange Ltd 21-27 St Thomas Street, London SE1 9RY Company Registered in England No. 3137929 Trinity Court, Trinity Street, Peterborough PE1 1DA
An additional question that I think is also critical to our progress is in the event of arbitration going to court will the California court system uphold the outcome of an arbitration in the face of the board claiming business judgement. I believe from my own research that this is very very unclear and would be a critical issue for us to understand (I don't believe this will be a yes or no answer from either counsel so will be a judgement call for the CCWG to make with informed legal input) This will have a serious impact on one of the core dependencies, i.e the ability to enforce the separation of the IANA if required, this has to be one of our cornerstone gates for moving forward through Dublin. Without a solid answer to this question under models other than membership I don't know if we will be in a position to fulfil this critical part of the CCWG's mandate from the CWG. -James ________________________________________ From: accountability-cross-community-bounces@icann.org <accountability-cross-community-bounces@icann.org> on behalf of Malcolm Hutty <malcolm@linx.net> Sent: 12 October 2015 11:01 To: Accountability Cross Community Cc: CCWG Accountability Subject: Re: [CCWG-ACCT] A plea for time On 12/10/2015 00:06, Jordan Carter wrote:
*In closing, I'd like to stress that the most important thing we can do is be up front and honest about what we do and don't support. *
_I don't support the Board's MEM proposal_ for the reasons set out above - it is untested and novel and hasn't been developed through a multistakeholder process. To validate it and think it through will delay this process and delay the transition.
I agree.
_I do support the CCWG's proposal_. It needs improvement but it is a genuine result of multistakeholder efforts, and after the community dialogue in Dublin we will know the remaining points of modification needed.
I agree.
_I could support, based on what I know today, a new synthesis_ with no membership but careful use of designators and the revised community consensus decision-making the CCWG is developing.
I'm not so sure. I don't think membership should be a matter of taste, it should be a question of whether it is required or beneficial to achieve our goals. There is currently a crucial question awaiting our Counsel's advice, Question 68 https://goo.gl/g0i64o This asks whether ICANN can be compelled to enter binding arbitration, on pain of forfeiting through a default judgement if it refuses to enter arbitration in a specific case. If the answer comes back as "no" (or less than a clear "yes"), then a membership model will be essential. The reason is that it will be necessary to ensure that someone has the capability to require ICANN to enter the IRP, as the Bylaws require it to do; only a member is capable of enforcing the bylaws through a derivative action. It is possible that there may be other reasons why membership is the only viable model. These should be considered and examined fairly. If membership is required, then we must not compromise. If we can do everything we need without it, then compromise can be entertained.
_All of these proposals need further refinement and the discussion has to go on until there is consensus. Until there is, nobody should try and finalise the proposal, because it'd be dead on arrival._
I agree. Malcolm. -- Malcolm Hutty | tel: +44 20 7645 3523 Head of Public Affairs | Read the LINX Public Affairs blog London Internet Exchange | http://publicaffairs.linx.net/ London Internet Exchange Ltd 21-27 St Thomas Street, London SE1 9RY Company Registered in England No. 3137929 Trinity Court, Trinity Street, Peterborough PE1 1DA _______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
Chris, Thank you for your email. Your email raises a number of issues; my responses are in-line in *bold* below. Greg On Sun, Oct 11, 2015 at 12:05 PM, Chris Disspain <ceo@auda.org.au> wrote:
Greetings,
As we approach ICANN Dublin I have been asked by some of my ccTLD colleagues to set out clearly why as a ccTLD manager I support the Board proposals for improving ICANN's accountability as part of the transition.
In essence for me it’s all about time.
*GS: Time is a double-edged sword in this case. I believe that a revised CCWG proposal that adopts the Board's comments will differ significantly enough from the Second Draft that a third public comment period will be required. As such, I think the shortest path leads through the Single Member model, not away from it. While there are still questions under discussion regarding the Second Draft Proposal, I believe that there at least as many, if not more, stemming from the Board's proposal. (I note the questions raised in my chart analyzing the Board's comments, most of which I believe remain unanswered.)* I believe that we, the community, can get the enhanced accountability we
want now without the need for wholesale structural change.
*GS: I remain concerned about the level of true accountability in the Board's proposal. Accountability is inextricably intertwined with enforceability, and I believe the Board's proposal fails to deliver on enforceability. *
I'm not against change or indeed any of the models being proposed but I am against making such changes without carefully considering them over time. There is a significant amount of work to be done before deciding to make such important structural changes and all of that will take time and more research and stress testing and unf oreseen consequence analysis and impact analysis.
*GS: I think this discounts the significant level of work and consideration that has already occurred in the CCWG, and the amount of time that has gone into this process.*
In essence the Board has supported the CCWG’s proposed fundamental bylaws and the binding IRP and has suggested that there be a Community IRP and a further fundamental bylaw setting in place an ongoing improvement mechanism that will allow the community to take the necessary time to consider the structural changes and to have confidence that the proposals arising from such a process will be implemented.
*GS: It's good that the Board supports the fundamental bylaws and the concept of a binding IRP, but these are only two (or maybe only one and a half) steps in the right direction. I think the Board's proposals regarding the IRP and the MEM proceeding vary in such significant ways from the CCWG's IRP proposals* * that support does not extend much beyond the concept of making the IRP binding (and even the interpretation of "binding" is troublesome -- see below).*
I believe that the Community IRP does provide the community with the rights it seeks and that it can be implemented in a timeframe that does not jeopardise the transition.
*GS: I am confident that the CCWG proposal can be implemented in a timeframe that does not jeopardize the transition, and I would be even more confident if the Board would join the CCWG in improving the CCWG proposal within the structural framework proposed by the CCWG. If the tug-of-war continues, that could jeopardize the transition.* The Community IRP is an independent arbitration process for hearing community claims that the Board has acted outside of its by-laws. Under the process there is a legally enforceable and contractual obligation on ICANN to comply with a decision of the arbitration panel. *GS: Under the Board's proposal, the Community IRP would be limited to fundamental bylaws, which is a concern. While a binding arbitration decision is generally "legally enforceable," the issue of whether there will be a legal person with standing to enforce is very much still open. I believe this would require the "MEM Issue Group" to form an Unincorporated Association (or force one or more SOACs to form UAs) before commencing the Community IRP (or would force SOAC leaders to bring both the IRP and any enforcement action in their individual names). The issue of whether a "default judgment" in an IRP is enforceable is also an open question. According to advice received today from CCWG counsel, there would likely be significant additional hurdles in attempting to enforce a default judgment (as well as hurdles in getting a default judgment in the first place).* I believe that the community find ourselves in our current difficult
situation because, with the best of intentions, the CCWG’s attorneys have been instructed to come up with models that deliver ‘the highest possible levels of enforcement’. It is not that the Community IRP cannot deliver the enhanced accountability that we want but rather that it is perceived, by some, as inadequate because there is a different mechanism that delivers a higher level of enforceability.
*GS: I don't think this accurately reflects the instructions to counsel or counsels' working methods. Counsel are working for us, and not leading us by the nose. We've asked for alternatives and they have given us alternatives. We generally didn't like the alternatives where enforceability seemed uncertain. In any case, all instructions to counsel are transparent and available on the CCWG Wiki. As for the Community IRP, I think it is perceived as inadequate due to issues of standing to commence a court action to enforce a binding arbitration and the proposed limitation of scope to fundamental bylaws. As such, it is far from clear that the Community IRP can deliver the enhanced accountability that we want.* The CCWG appears to be requiring a mechanism that allows the community (in
whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty.
*GS: The first sentence is true, with regard to certain narrowly defined powers to exercised as a last resort -- removal of directors, recall of the Board, approve fundamental bylaws changes, veto standard bylaws changes, and veto budget/strat plan/op plan. Outside of these areas, the community would not have the "absolute final say." With the IRP, this is clearly not the case, since there the IRP panel would have the final say. In a membership public benefit (non-profit) corporation, the members do indeed get the last say on certain things, but certainly not on everything. Where the membership has the final say, the Board will not be in breach of its fiduciary duty if it follows the directions of membership -- such is the relationship of membership to Board. Indeed, the Board would be in violation of its bylaws, probably statutes and possibly its fiduciary duties if it did not follow the directions of membership. However, without membership, the Board will be able to invoke fiduciary duty as a reason not to follow the decision of the community. We do have to look further into the boundaries and obligations of members in a membership public benefit corporation to understand better how to avoid a "rogue" membership, both as a matter of law and as a matter of process. For instance, the assets of a public benefit corporation are always dedicated to the public good, and cannot be used for private or personal gain; this applies equally to decisions by membership as it does to Board decisions. Similarly, I don't believe the membership can cause the corporation to act in a way that violates its Articles of Incorporation or Bylaws; this limits membership just as much as it does the Board, "fiduciary duty" or no. Finally, we could consider instituting a consultative process where the Board would have a limited period of time to make its case that in exercising one of membership's powers (remove/recall directors, approve/veto bylaws, veto budget/strat plan/op plan), the membership is violating the Articles or Bylaws.* I firmly believe in the corporate governance structures adopted by most
corporate bodies around the world. Board members are appointed to manage the affairs of the organisation on the understanding that they are legally bound to act in the best interests of the organization rather than any one member or community. Such best interests are set out in the by-laws - in ICANN's case for example, the security and stability of the Internet as a whole. The Board has a fiduciary obligations to act in that way.
*GS: This is comparing apples and oranges, assuming we are talking about for-profit corporate bodies. Corporate bodies have owners/shareholders. In that corporate governance structure, the Board is ultimately accountable to the owners of the company. When shareholders vote for directors (and especially when a shareholder has a large enough position to appoint a board member), they appoint that Board member because their views are consistent with that shareholder's (or those shareholders') view of the best interests of the corporation. The best interests of a corporation (any corporation) are open to differing views and judgments. If we are talking about non-profit corporate bodies, then that firm belief should include a belief in the membership structure as a widely-recognized, well-tested form of corporate governance structure. Finally, "fiduciary duty" should not be used as a monolithic mantra -- a non-profit board member has three specific duties that make up their fiduciary duty -- the duty of care, the duty of loyalty, and the duty of obedience. The first two are firmly owed to the organization alone. Only the duty of obedience binds the board member to act consistently with the mission, purpose and core values of the corporation, primarily as set forth in its Articles and Bylaws. As noted above, I don't believe the Members have the right or ability to cause the corporation to violate its Articles or Bylaws, as measured by the reasonable judgment of the Membership. *
The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right.
*GS: This paragraph reveals a fundamental misunderstanding of what an enforcement proceeding is, at least in US courts (and most courts I'm familiar with, other than perhaps Dubai). In a proceeding to enforce a judgment resulting from binding arbitration, the court does not see "if it disagrees with the Board's view." The court does not conduct a substantive review of the arbitration decision at all, much less a "de novo" review, to see whether it agrees with the arbitrators. The court, in reviewing the award, is supposed draw all reasonable inferences to support the award and display substantial deference towards the panel's determination. (One exception, under California state law, is that the parties to an arbitration can expand the scope of review by putting a differest standard in their initial agreement to arbitrate, but that would be highly unusual, and could essentially gut the idea of an enforcement proceeding.) An enforcement proceeding is basically a proceeding to turn the arbitral award (which only has the force and effect of a contract between the parties) into a final and non-appealable court judgment. The court can modify, correct or overturn a binding arbitration decision only if it fails the "reasonable inference/substantial deference" test, or if the losing party files a petition based on bad acts by the arbitrator (e.g., corruption, fraud, misconduct, exceeding arbitrator's powers, unduly prejudicial acts, failure to disqualify).*
The alternative, it seems to me, is to create, now, a system where fiduciary duty is abandoned and the will of the community holds sway. That is in effect what happens under the membership model as described by the CCWG’s attorneys.
*GS: I disagree strongly with that characterization of the Single Member model. This makes the Single Member model sound like some anarchic combination of the worst excesses of the French Revolution and the "Lord of the Flies." (apologies for culturally-based references.) Fiduciary duty is absolutely not "abandoned." The Board has absolutely the same obligations to act with a duty of care and a duty of loyalty to the corporation, and a duty of obedience toward the ICANN mission, purpose and core values. In most cases, its actions are not subject to review, or if they are, it is in an IRP, where the mission, purpose and core values of ICANN (the heart of the duty of obedience) will be the standard for measurement. Only in the exercise of the powers would the "will of the community" get the last word, and only after a substantial process designed to resolve matters before the powers must be exercised. Even then, the community is not free to do as it pleases -- it cannot convert the use of assets so they are no longer benefiting the public, and the community must in its judgment still be honoring the ICANN mission, purpose and core values. Just because the community as member doesn't have "fiduciary duties" to the corporation, it doesn't mean that the community is without duties, obligations and boundaries. Finally, I'm not sure if the reference to the CCWG's attorneys is meant to imply "look at what your own counsel told you" or "blame your counsel for what they got you into," but I reject both. *
This may well be acceptable in the future when all of the nuances have been thought through and the necessary community conflicts and ethics rules, accountability mechanisms and disclosure requirements have been agreed. But it will take time and testing and a fuller discussion.
*GS: This is based on the false premises of abandonment of fiduciary duty and that the community is simply not ready for the task of holding ICANN accountable. If the community is not ready, how can ICANN be ready? I'm not saying the community is perfect, and there are potential implementation matters such as those above that could improve the community's abilities to act as the party that will hold ICANN to account. I don't think these will take so much time and testing and discussion that we should abandon our path. If we need to choose between an inadequate set of accountability mechanisms and giving the community we have the accountability mechanisms it needs, the choice is easy. *
Fiduciary responsibilities and duties are there for a reason. I think that some in the community feel that the Board and ICANN legal sometimes use the ‘cloak’ of fiduciary responsibility to avoid doing what the community wants. Whilst I don’t believe that is true I do empathise with the feeling. To my mind the solution (at least at this time during the transition) is NOT to create a mechanism under which fiduciary duty is held by no one but rather to create a mechanism where the community can test the Board's claims about such duty. The Community IRP as suggested by the Board does just that.
*GS: Again, no one is proposing a mechanism "under which fiduciary duty is held by no one." The Board's duties remain unchanged under any proposal. The IRP remains a method of testing the Board's claims about those duties under any proposal. The differences lie elsewhere -- in whether the community powers will be diluted (to the point where they cannot be considered powers) and whether the IRP is a readily enforceable arbitration. * I want to stress again that I am not against any of the proposed models put forward by the CCWG. But I can't agree the models at this stage because I don’t believe we have enough detail and I think the community as a whole should take their time in considering making such important changes. And I do not agree with those who claim that "we must do it now because it's our only chance". *GS: I'm glad you don't think it's our only chance, and I trust you on that. Where we disagree is on whether we have sufficient detail and whether we've taken sufficient time, and whether the outcome of the CCWG process is sufficiently well-crafted. Trading the CCWG proposal for one with even less detail and less time devoted to it, and which raises serious concerns about sufficiency, does not seem like an improvement. At best, it trades one set of problems for another. I don't deny we can use some good tightening up and some good implementation planning. If you will join us in tightening the bolts, rather than having us park the car and board the bus, we'll get to our destination faster.*
I am very much looking forward to spending time with my ccTLD colleagues during the Dublin meeting and hope we will have the opportunity to talk, and not just about the transition.
*GS: Although I'm not a ccTLD colleague I still look forward to Dublin and the opportunity to talk ... and possibly about something besides the transition!* *Greg *
Cheers,
Chris Disspain | Chief Executive Officer
.au Domain Administration Ltd
T: +61 3 8341 4111 | F: +61 3 8341 4112
E: ceo@auda.org.au | W: www.auda.org.au
auDA – Australia’s Domain Name Administrator
*Important Notice* *- *This email may contain information which is confidential and/or subject to legal privilege, and is intended for the use of the named addressee only. If you are not the intended recipient, you must not use, disclose or copy any part of this email. If you have received this email by mistake, please notify the sender and delete this message immediately. Please consider the environment before printing this email.
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+1. Excellent responses, Greg. Philip S. Corwin, Founding Principal Virtualaw LLC 1155 F Street, NW Suite 1050 Washington, DC 20004 202-559-8597/Direct 202-559-8750/Fax 202-255-6172/cell Twitter: @VlawDC "Luck is the residue of design" -- Branch Rickey From: accountability-cross-community-bounces@icann.org [mailto:accountability-cross-community-bounces@icann.org] On Behalf Of Greg Shatan Sent: Monday, October 12, 2015 4:09 PM To: Chris Disspain Cc: ccNSO Council; ccNSO Members; CCWG Accountability Subject: Re: [CCWG-ACCT] A plea for time Chris, Thank you for your email. Your email raises a number of issues; my responses are in-line in bold below. Greg On Sun, Oct 11, 2015 at 12:05 PM, Chris Disspain <ceo@auda.org.au<mailto:ceo@auda.org.au>> wrote: Greetings, As we approach ICANN Dublin I have been asked by some of my ccTLD colleagues to set out clearly why as a ccTLD manager I support the Board proposals for improving ICANN's accountability as part of the transition. In essence for me it’s all about time. GS: Time is a double-edged sword in this case. I believe that a revised CCWG proposal that adopts the Board's comments will differ significantly enough from the Second Draft that a third public comment period will be required. As such, I think the shortest path leads through the Single Member model, not away from it. While there are still questions under discussion regarding the Second Draft Proposal, I believe that there at least as many, if not more, stemming from the Board's proposal. (I note the questions raised in my chart analyzing the Board's comments, most of which I believe remain unanswered.) I believe that we, the community, can get the enhanced accountability we want now without the need for wholesale structural change. GS: I remain concerned about the level of true accountability in the Board's proposal. Accountability is inextricably intertwined with enforceability, and I believe the Board's proposal fails to deliver on enforceability. I'm not against change or indeed any of the models being proposed but I am against making such changes without carefully considering them over time. There is a significant amount of work to be done before deciding to make such important structural changes and all of that will take time and more research and stress testing and unf oreseen consequence analysis and impact analysis. GS: I think this discounts the significant level of work and consideration that has already occurred in the CCWG, and the amount of time that has gone into this process. In essence the Board has supported the CCWG’s proposed fundamental bylaws and the binding IRP and has suggested that there be a Community IRP and a further fundamental bylaw setting in place an ongoing improvement mechanism that will allow the community to take the necessary time to consider the structural changes and to have confidence that the proposals arising from such a process will be implemented. GS: It's good that the Board supports the fundamental bylaws and the concept of a binding IRP, but these are only two (or maybe only one and a half) steps in the right direction. I think the Board's proposals regarding the IRP and the MEM proceeding vary in such significant ways from the CCWG's IRP proposals that support does not extend much beyond the concept of making the IRP binding (and even the interpretation of "binding" is troublesome -- see below). I believe that the Community IRP does provide the community with the rights it seeks and that it can be implemented in a timeframe that does not jeopardise the transition. GS: I am confident that the CCWG proposal can be implemented in a timeframe that does not jeopardize the transition, and I would be even more confident if the Board would join the CCWG in improving the CCWG proposal within the structural framework proposed by the CCWG. If the tug-of-war continues, that could jeopardize the transition. The Community IRP is an independent arbitration process for hearing community claims that the Board has acted outside of its by-laws. Under the process there is a legally enforceable and contractual obligation on ICANN to comply with a decision of the arbitration panel. GS: Under the Board's proposal, the Community IRP would be limited to fundamental bylaws, which is a concern. While a binding arbitration decision is generally "legally enforceable," the issue of whether there will be a legal person with standing to enforce is very much still open. I believe this would require the "MEM Issue Group" to form an Unincorporated Association (or force one or more SOACs to form UAs) before commencing the Community IRP (or would force SOAC leaders to bring both the IRP and any enforcement action in their individual names). The issue of whether a "default judgment" in an IRP is enforceable is also an open question. According to advice received today from CCWG counsel, there would likely be significant additional hurdles in attempting to enforce a default judgment (as well as hurdles in getting a default judgment in the first place). I believe that the community find ourselves in our current difficult situation because, with the best of intentions, the CCWG’s attorneys have been instructed to come up with models that deliver ‘the highest possible levels of enforcement’. It is not that the Community IRP cannot deliver the enhanced accountability that we want but rather that it is perceived, by some, as inadequate because there is a different mechanism that delivers a higher level of enforceability. GS: I don't think this accurately reflects the instructions to counsel or counsels' working methods. Counsel are working for us, and not leading us by the nose. We've asked for alternatives and they have given us alternatives. We generally didn't like the alternatives where enforceability seemed uncertain. In any case, all instructions to counsel are transparent and available on the CCWG Wiki. As for the Community IRP, I think it is perceived as inadequate due to issues of standing to commence a court action to enforce a binding arbitration and the proposed limitation of scope to fundamental bylaws. As such, it is far from clear that the Community IRP can deliver the enhanced accountability that we want. The CCWG appears to be requiring a mechanism that allows the community (in whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty. GS: The first sentence is true, with regard to certain narrowly defined powers to exercised as a last resort -- removal of directors, recall of the Board, approve fundamental bylaws changes, veto standard bylaws changes, and veto budget/strat plan/op plan. Outside of these areas, the community would not have the "absolute final say." With the IRP, this is clearly not the case, since there the IRP panel would have the final say. In a membership public benefit (non-profit) corporation, the members do indeed get the last say on certain things, but certainly not on everything. Where the membership has the final say, the Board will not be in breach of its fiduciary duty if it follows the directions of membership -- such is the relationship of membership to Board. Indeed, the Board would be in violation of its bylaws, probably statutes and possibly its fiduciary duties if it did not follow the directions of membership. However, without membership, the Board will be able to invoke fiduciary duty as a reason not to follow the decision of the community. We do have to look further into the boundaries and obligations of members in a membership public benefit corporation to understand better how to avoid a "rogue" membership, both as a matter of law and as a matter of process. For instance, the assets of a public benefit corporation are always dedicated to the public good, and cannot be used for private or personal gain; this applies equally to decisions by membership as it does to Board decisions. Similarly, I don't believe the membership can cause the corporation to act in a way that violates its Articles of Incorporation or Bylaws; this limits membership just as much as it does the Board, "fiduciary duty" or no. Finally, we could consider instituting a consultative process where the Board would have a limited period of time to make its case that in exercising one of membership's powers (remove/recall directors, approve/veto bylaws, veto budget/strat plan/op plan), the membership is violating the Articles or Bylaws. I firmly believe in the corporate governance structures adopted by most corporate bodies around the world. Board members are appointed to manage the affairs of the organisation on the understanding that they are legally bound to act in the best interests of the organization rather than any one member or community. Such best interests are set out in the by-laws - in ICANN's case for example, the security and stability of the Internet as a whole. The Board has a fiduciary obligations to act in that way. GS: This is comparing apples and oranges, assuming we are talking about for-profit corporate bodies. Corporate bodies have owners/shareholders. In that corporate governance structure, the Board is ultimately accountable to the owners of the company. When shareholders vote for directors (and especially when a shareholder has a large enough position to appoint a board member), they appoint that Board member because their views are consistent with that shareholder's (or those shareholders') view of the best interests of the corporation. The best interests of a corporation (any corporation) are open to differing views and judgments. If we are talking about non-profit corporate bodies, then that firm belief should include a belief in the membership structure as a widely-recognized, well-tested form of corporate governance structure. Finally, "fiduciary duty" should not be used as a monolithic mantra -- a non-profit board member has three specific duties that make up their fiduciary duty -- the duty of care, the duty of loyalty, and the duty of obedience. The first two are firmly owed to the organization alone. Only the duty of obedience binds the board member to act consistently with the mission, purpose and core values of the corporation, primarily as set forth in its Articles and Bylaws. As noted above, I don't believe the Members have the right or ability to cause the corporation to violate its Articles or Bylaws, as measured by the reasonable judgment of the Membership. The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right. GS: This paragraph reveals a fundamental misunderstanding of what an enforcement proceeding is, at least in US courts (and most courts I'm familiar with, other than perhaps Dubai). In a proceeding to enforce a judgment resulting from binding arbitration, the court does not see "if it disagrees with the Board's view." The court does not conduct a substantive review of the arbitration decision at all, much less a "de novo" review, to see whether it agrees with the arbitrators. The court, in reviewing the award, is supposed draw all reasonable inferences to support the award and display substantial deference towards the panel's determination. (One exception, under California state law, is that the parties to an arbitration can expand the scope of review by putting a differest standard in their initial agreement to arbitrate, but that would be highly unusual, and could essentially gut the idea of an enforcement proceeding.) An enforcement proceeding is basically a proceeding to turn the arbitral award (which only has the force and effect of a contract between the parties) into a final and non-appealable court judgment. The court can modify, correct or overturn a binding arbitration decision only if it fails the "reasonable inference/substantial deference" test, or if the losing party files a petition based on bad acts by the arbitrator (e.g., corruption, fraud, misconduct, exceeding arbitrator's powers, unduly prejudicial acts, failure to disqualify). The alternative, it seems to me, is to create, now, a system where fiduciary duty is abandoned and the will of the community holds sway. That is in effect what happens under the membership model as described by the CCWG’s attorneys. GS: I disagree strongly with that characterization of the Single Member model. This makes the Single Member model sound like some anarchic combination of the worst excesses of the French Revolution and the "Lord of the Flies." (apologies for culturally-based references.) Fiduciary duty is absolutely not "abandoned." The Board has absolutely the same obligations to act with a duty of care and a duty of loyalty to the corporation, and a duty of obedience toward the ICANN mission, purpose and core values. In most cases, its actions are not subject to review, or if they are, it is in an IRP, where the mission, purpose and core values of ICANN (the heart of the duty of obedience) will be the standard for measurement. Only in the exercise of the powers would the "will of the community" get the last word, and only after a substantial process designed to resolve matters before the powers must be exercised. Even then, the community is not free to do as it pleases -- it cannot convert the use of assets so they are no longer benefiting the public, and the community must in its judgment still be honoring the ICANN mission, purpose and core values. Just because the community as member doesn't have "fiduciary duties" to the corporation, it doesn't mean that the community is without duties, obligations and boundaries. Finally, I'm not sure if the reference to the CCWG's attorneys is meant to imply "look at what your own counsel told you" or "blame your counsel for what they got you into," but I reject both. This may well be acceptable in the future when all of the nuances have been thought through and the necessary community conflicts and ethics rules, accountability mechanisms and disclosure requirements have been agreed. But it will take time and testing and a fuller discussion. GS: This is based on the false premises of abandonment of fiduciary duty and that the community is simply not ready for the task of holding ICANN accountable. If the community is not ready, how can ICANN be ready? I'm not saying the community is perfect, and there are potential implementation matters such as those above that could improve the community's abilities to act as the party that will hold ICANN to account. I don't think these will take so much time and testing and discussion that we should abandon our path. If we need to choose between an inadequate set of accountability mechanisms and giving the community we have the accountability mechanisms it needs, the choice is easy. Fiduciary responsibilities and duties are there for a reason. I think that some in the community feel that the Board and ICANN legal sometimes use the ‘cloak’ of fiduciary responsibility to avoid doing what the community wants. Whilst I don’t believe that is true I do empathise with the feeling. To my mind the solution (at least at this time during the transition) is NOT to create a mechanism under which fiduciary duty is held by no one but rather to create a mechanism where the community can test the Board's claims about such duty. The Community IRP as suggested by the Board does just that. GS: Again, no one is proposing a mechanism "under which fiduciary duty is held by no one." The Board's duties remain unchanged under any proposal. The IRP remains a method of testing the Board's claims about those duties under any proposal. The differences lie elsewhere -- in whether the community powers will be diluted (to the point where they cannot be considered powers) and whether the IRP is a readily enforceable arbitration. I want to stress again that I am not against any of the proposed models put forward by the CCWG. But I can't agree the models at this stage because I don’t believe we have enough detail and I think the community as a whole should take their time in considering making such important changes. And I do not agree with those who claim that "we must do it now because it's our only chance". GS: I'm glad you don't think it's our only chance, and I trust you on that. Where we disagree is on whether we have sufficient detail and whether we've taken sufficient time, and whether the outcome of the CCWG process is sufficiently well-crafted. Trading the CCWG proposal for one with even less detail and less time devoted to it, and which raises serious concerns about sufficiency, does not seem like an improvement. At best, it trades one set of problems for another. I don't deny we can use some good tightening up and some good implementation planning. If you will join us in tightening the bolts, rather than having us park the car and board the bus, we'll get to our destination faster. I am very much looking forward to spending time with my ccTLD colleagues during the Dublin meeting and hope we will have the opportunity to talk, and not just about the transition. GS: Although I'm not a ccTLD colleague I still look forward to Dublin and the opportunity to talk ... and possibly about something besides the transition! Greg Cheers, Chris Disspain | Chief Executive Officer .au Domain Administration Ltd T: +61 3 8341 4111<tel:%2B61%203%208341%204111> | F: +61 3 8341 4112<tel:%2B61%203%208341%204112> E: ceo@auda.org.au<mailto:ceo@auda.org.au> | W: www.auda.org.au<http://www.auda.org.au/> auDA – Australia’s Domain Name Administrator Important Notice - This email may contain information which is confidential and/or subject to legal privilege, and is intended for the use of the named addressee only. If you are not the intended recipient, you must not use, disclose or copy any part of this email. If you have received this email by mistake, please notify the sender and delete this message immediately. Please consider the environment before printing this email. _______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org<mailto:Accountability-Cross-Community@icann.org> https://mm.icann.org/mailman/listinfo/accountability-cross-community ________________________________ No virus found in this message. Checked by AVG - www.avg.com<http://www.avg.com> Version: 2015.0.6140 / Virus Database: 4435/10780 - Release Date: 10/08/15
+1 Greg. [cid:image001.gif@01D104FF.2552A5C0] Anne E. Aikman-Scalese, Of Counsel Lewis Roca Rothgerber LLP One South Church Avenue Suite 700 | Tucson, Arizona 85701-1611 (T) 520.629.4428 | (F) 520.879.4725 AAikman@lrrlaw.com<mailto:AAikman@lrrlaw.com> | www.LRRLaw.com<http://www.lrrlaw.com/> From: accountability-cross-community-bounces@icann.org [mailto:accountability-cross-community-bounces@icann.org] On Behalf Of Phil Corwin Sent: Monday, October 12, 2015 2:14 PM To: Greg Shatan; Chris Disspain Cc: ccNSO Council; ccNSO Members; CCWG Accountability Subject: Re: [CCWG-ACCT] A plea for time +1. Excellent responses, Greg. Philip S. Corwin, Founding Principal Virtualaw LLC 1155 F Street, NW Suite 1050 Washington, DC 20004 202-559-8597/Direct 202-559-8750/Fax 202-255-6172/cell Twitter: @VlawDC "Luck is the residue of design" -- Branch Rickey From: accountability-cross-community-bounces@icann.org<mailto:accountability-cross-community-bounces@icann.org> [mailto:accountability-cross-community-bounces@icann.org] On Behalf Of Greg Shatan Sent: Monday, October 12, 2015 4:09 PM To: Chris Disspain Cc: ccNSO Council; ccNSO Members; CCWG Accountability Subject: Re: [CCWG-ACCT] A plea for time Chris, Thank you for your email. Your email raises a number of issues; my responses are in-line in bold below. Greg On Sun, Oct 11, 2015 at 12:05 PM, Chris Disspain <ceo@auda.org.au<mailto:ceo@auda.org.au>> wrote: Greetings, As we approach ICANN Dublin I have been asked by some of my ccTLD colleagues to set out clearly why as a ccTLD manager I support the Board proposals for improving ICANN's accountability as part of the transition. In essence for me it’s all about time. GS: Time is a double-edged sword in this case. I believe that a revised CCWG proposal that adopts the Board's comments will differ significantly enough from the Second Draft that a third public comment period will be required. As such, I think the shortest path leads through the Single Member model, not away from it. While there are still questions under discussion regarding the Second Draft Proposal, I believe that there at least as many, if not more, stemming from the Board's proposal. (I note the questions raised in my chart analyzing the Board's comments, most of which I believe remain unanswered.) I believe that we, the community, can get the enhanced accountability we want now without the need for wholesale structural change. GS: I remain concerned about the level of true accountability in the Board's proposal. Accountability is inextricably intertwined with enforceability, and I believe the Board's proposal fails to deliver on enforceability. I'm not against change or indeed any of the models being proposed but I am against making such changes without carefully considering them over time. There is a significant amount of work to be done before deciding to make such important structural changes and all of that will take time and more research and stress testing and unf oreseen consequence analysis and impact analysis. GS: I think this discounts the significant level of work and consideration that has already occurred in the CCWG, and the amount of time that has gone into this process. In essence the Board has supported the CCWG’s proposed fundamental bylaws and the binding IRP and has suggested that there be a Community IRP and a further fundamental bylaw setting in place an ongoing improvement mechanism that will allow the community to take the necessary time to consider the structural changes and to have confidence that the proposals arising from such a process will be implemented. GS: It's good that the Board supports the fundamental bylaws and the concept of a binding IRP, but these are only two (or maybe only one and a half) steps in the right direction. I think the Board's proposals regarding the IRP and the MEM proceeding vary in such significant ways from the CCWG's IRP proposals that support does not extend much beyond the concept of making the IRP binding (and even the interpretation of "binding" is troublesome -- see below). I believe that the Community IRP does provide the community with the rights it seeks and that it can be implemented in a timeframe that does not jeopardise the transition. GS: I am confident that the CCWG proposal can be implemented in a timeframe that does not jeopardize the transition, and I would be even more confident if the Board would join the CCWG in improving the CCWG proposal within the structural framework proposed by the CCWG. If the tug-of-war continues, that could jeopardize the transition. The Community IRP is an independent arbitration process for hearing community claims that the Board has acted outside of its by-laws. Under the process there is a legally enforceable and contractual obligation on ICANN to comply with a decision of the arbitration panel. GS: Under the Board's proposal, the Community IRP would be limited to fundamental bylaws, which is a concern. While a binding arbitration decision is generally "legally enforceable," the issue of whether there will be a legal person with standing to enforce is very much still open. I believe this would require the "MEM Issue Group" to form an Unincorporated Association (or force one or more SOACs to form UAs) before commencing the Community IRP (or would force SOAC leaders to bring both the IRP and any enforcement action in their individual names). The issue of whether a "default judgment" in an IRP is enforceable is also an open question. According to advice received today from CCWG counsel, there would likely be significant additional hurdles in attempting to enforce a default judgment (as well as hurdles in getting a default judgment in the first place). I believe that the community find ourselves in our current difficult situation because, with the best of intentions, the CCWG’s attorneys have been instructed to come up with models that deliver ‘the highest possible levels of enforcement’. It is not that the Community IRP cannot deliver the enhanced accountability that we want but rather that it is perceived, by some, as inadequate because there is a different mechanism that delivers a higher level of enforceability. GS: I don't think this accurately reflects the instructions to counsel or counsels' working methods. Counsel are working for us, and not leading us by the nose. We've asked for alternatives and they have given us alternatives. We generally didn't like the alternatives where enforceability seemed uncertain. In any case, all instructions to counsel are transparent and available on the CCWG Wiki. As for the Community IRP, I think it is perceived as inadequate due to issues of standing to commence a court action to enforce a binding arbitration and the proposed limitation of scope to fundamental bylaws. As such, it is far from clear that the Community IRP can deliver the enhanced accountability that we want. The CCWG appears to be requiring a mechanism that allows the community (in whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty. GS: The first sentence is true, with regard to certain narrowly defined powers to exercised as a last resort -- removal of directors, recall of the Board, approve fundamental bylaws changes, veto standard bylaws changes, and veto budget/strat plan/op plan. Outside of these areas, the community would not have the "absolute final say." With the IRP, this is clearly not the case, since there the IRP panel would have the final say. In a membership public benefit (non-profit) corporation, the members do indeed get the last say on certain things, but certainly not on everything. Where the membership has the final say, the Board will not be in breach of its fiduciary duty if it follows the directions of membership -- such is the relationship of membership to Board. Indeed, the Board would be in violation of its bylaws, probably statutes and possibly its fiduciary duties if it did not follow the directions of membership. However, without membership, the Board will be able to invoke fiduciary duty as a reason not to follow the decision of the community. We do have to look further into the boundaries and obligations of members in a membership public benefit corporation to understand better how to avoid a "rogue" membership, both as a matter of law and as a matter of process. For instance, the assets of a public benefit corporation are always dedicated to the public good, and cannot be used for private or personal gain; this applies equally to decisions by membership as it does to Board decisions. Similarly, I don't believe the membership can cause the corporation to act in a way that violates its Articles of Incorporation or Bylaws; this limits membership just as much as it does the Board, "fiduciary duty" or no. Finally, we could consider instituting a consultative process where the Board would have a limited period of time to make its case that in exercising one of membership's powers (remove/recall directors, approve/veto bylaws, veto budget/strat plan/op plan), the membership is violating the Articles or Bylaws. I firmly believe in the corporate governance structures adopted by most corporate bodies around the world. Board members are appointed to manage the affairs of the organisation on the understanding that they are legally bound to act in the best interests of the organization rather than any one member or community. Such best interests are set out in the by-laws - in ICANN's case for example, the security and stability of the Internet as a whole. The Board has a fiduciary obligations to act in that way. GS: This is comparing apples and oranges, assuming we are talking about for-profit corporate bodies. Corporate bodies have owners/shareholders. In that corporate governance structure, the Board is ultimately accountable to the owners of the company. When shareholders vote for directors (and especially when a shareholder has a large enough position to appoint a board member), they appoint that Board member because their views are consistent with that shareholder's (or those shareholders') view of the best interests of the corporation. The best interests of a corporation (any corporation) are open to differing views and judgments. If we are talking about non-profit corporate bodies, then that firm belief should include a belief in the membership structure as a widely-recognized, well-tested form of corporate governance structure. Finally, "fiduciary duty" should not be used as a monolithic mantra -- a non-profit board member has three specific duties that make up their fiduciary duty -- the duty of care, the duty of loyalty, and the duty of obedience. The first two are firmly owed to the organization alone. Only the duty of obedience binds the board member to act consistently with the mission, purpose and core values of the corporation, primarily as set forth in its Articles and Bylaws. As noted above, I don't believe the Members have the right or ability to cause the corporation to violate its Articles or Bylaws, as measured by the reasonable judgment of the Membership. The ICANN Board has proposed the Community IRP as binding arbitration. The CCWG’s attorneys have said that the Board can refuse to implement such a binding arbitration decision if it claims that to implement it would be a breach of its obligations to act in the best interests of ICANN. This is true BUT the community representatives can then go to court and a court will enforce the arbitration decision if it disagrees with the Board's view. In my opinion this is precisely the type of safeguard we need to have in place because it ensures that an elected board made up of representatives of the multi-stakeholder community will always act, first, in the interests of a stable and secure Internet and it puts in place an independent arbiter to decide, in the final analysis, if the community or the board is right. GS: This paragraph reveals a fundamental misunderstanding of what an enforcement proceeding is, at least in US courts (and most courts I'm familiar with, other than perhaps Dubai). In a proceeding to enforce a judgment resulting from binding arbitration, the court does not see "if it disagrees with the Board's view." The court does not conduct a substantive review of the arbitration decision at all, much less a "de novo" review, to see whether it agrees with the arbitrators. The court, in reviewing the award, is supposed draw all reasonable inferences to support the award and display substantial deference towards the panel's determination. (One exception, under California state law, is that the parties to an arbitration can expand the scope of review by putting a differest standard in their initial agreement to arbitrate, but that would be highly unusual, and could essentially gut the idea of an enforcement proceeding.) An enforcement proceeding is basically a proceeding to turn the arbitral award (which only has the force and effect of a contract between the parties) into a final and non-appealable court judgment. The court can modify, correct or overturn a binding arbitration decision only if it fails the "reasonable inference/substantial deference" test, or if the losing party files a petition based on bad acts by the arbitrator (e.g., corruption, fraud, misconduct, exceeding arbitrator's powers, unduly prejudicial acts, failure to disqualify). The alternative, it seems to me, is to create, now, a system where fiduciary duty is abandoned and the will of the community holds sway. That is in effect what happens under the membership model as described by the CCWG’s attorneys. GS: I disagree strongly with that characterization of the Single Member model. This makes the Single Member model sound like some anarchic combination of the worst excesses of the French Revolution and the "Lord of the Flies." (apologies for culturally-based references.) Fiduciary duty is absolutely not "abandoned." The Board has absolutely the same obligations to act with a duty of care and a duty of loyalty to the corporation, and a duty of obedience toward the ICANN mission, purpose and core values. In most cases, its actions are not subject to review, or if they are, it is in an IRP, where the mission, purpose and core values of ICANN (the heart of the duty of obedience) will be the standard for measurement. Only in the exercise of the powers would the "will of the community" get the last word, and only after a substantial process designed to resolve matters before the powers must be exercised. Even then, the community is not free to do as it pleases -- it cannot convert the use of assets so they are no longer benefiting the public, and the community must in its judgment still be honoring the ICANN mission, purpose and core values. Just because the community as member doesn't have "fiduciary duties" to the corporation, it doesn't mean that the community is without duties, obligations and boundaries. Finally, I'm not sure if the reference to the CCWG's attorneys is meant to imply "look at what your own counsel told you" or "blame your counsel for what they got you into," but I reject both. This may well be acceptable in the future when all of the nuances have been thought through and the necessary community conflicts and ethics rules, accountability mechanisms and disclosure requirements have been agreed. But it will take time and testing and a fuller discussion. GS: This is based on the false premises of abandonment of fiduciary duty and that the community is simply not ready for the task of holding ICANN accountable. If the community is not ready, how can ICANN be ready? I'm not saying the community is perfect, and there are potential implementation matters such as those above that could improve the community's abilities to act as the party that will hold ICANN to account. I don't think these will take so much time and testing and discussion that we should abandon our path. If we need to choose between an inadequate set of accountability mechanisms and giving the community we have the accountability mechanisms it needs, the choice is easy. Fiduciary responsibilities and duties are there for a reason. I think that some in the community feel that the Board and ICANN legal sometimes use the ‘cloak’ of fiduciary responsibility to avoid doing what the community wants. Whilst I don’t believe that is true I do empathise with the feeling. To my mind the solution (at least at this time during the transition) is NOT to create a mechanism under which fiduciary duty is held by no one but rather to create a mechanism where the community can test the Board's claims about such duty. The Community IRP as suggested by the Board does just that. GS: Again, no one is proposing a mechanism "under which fiduciary duty is held by no one." The Board's duties remain unchanged under any proposal. The IRP remains a method of testing the Board's claims about those duties under any proposal. The differences lie elsewhere -- in whether the community powers will be diluted (to the point where they cannot be considered powers) and whether the IRP is a readily enforceable arbitration. I want to stress again that I am not against any of the proposed models put forward by the CCWG. But I can't agree the models at this stage because I don’t believe we have enough detail and I think the community as a whole should take their time in considering making such important changes. And I do not agree with those who claim that "we must do it now because it's our only chance". GS: I'm glad you don't think it's our only chance, and I trust you on that. Where we disagree is on whether we have sufficient detail and whether we've taken sufficient time, and whether the outcome of the CCWG process is sufficiently well-crafted. Trading the CCWG proposal for one with even less detail and less time devoted to it, and which raises serious concerns about sufficiency, does not seem like an improvement. At best, it trades one set of problems for another. I don't deny we can use some good tightening up and some good implementation planning. If you will join us in tightening the bolts, rather than having us park the car and board the bus, we'll get to our destination faster. I am very much looking forward to spending time with my ccTLD colleagues during the Dublin meeting and hope we will have the opportunity to talk, and not just about the transition. GS: Although I'm not a ccTLD colleague I still look forward to Dublin and the opportunity to talk ... and possibly about something besides the transition! Greg Cheers, Chris Disspain | Chief Executive Officer .au Domain Administration Ltd T: +61 3 8341 4111<tel:%2B61%203%208341%204111> | F: +61 3 8341 4112<tel:%2B61%203%208341%204112> E: ceo@auda.org.au<mailto:ceo@auda.org.au> | W: www.auda.org.au<http://www.auda.org.au/> auDA – Australia’s Domain Name Administrator Important Notice - This email may contain information which is confidential and/or subject to legal privilege, and is intended for the use of the named addressee only. If you are not the intended recipient, you must not use, disclose or copy any part of this email. 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On 2015-10-12 21:09, Greg Shatan wrote:
Chris Dispain wrote:
The CCWG appears to be requiring a mechanism that allows the community (in whatever guise we finally agree is acceptable) the absolute final say. The right to step over the Board's fiduciary duty without any check or balance in place to allow for the testing of the Board's claim that acting would indeed be in breach of such duty.
FOLLOW THE DECISION OF THE COMMUNITY. WE DO HAVE TO LOOK FURTHER INTO THE BOUNDARIES AND OBLIGATIONS OF MEMBERS IN A MEMBERSHIP PUBLIC BENEFIT CORPORATION TO UNDERSTAND BETTER HOW TO AVOID A "ROGUE" MEMBERSHIP, BOTH AS A MATTER OF LAW AND AS A MATTER OF PROCESS. FOR INSTANCE, THE ASSETS OF A PUBLIC BENEFIT CORPORATION ARE ALWAYS DEDICATED TO THE PUBLIC GOOD, AND CANNOT BE USED FOR PRIVATE OR PERSONAL GAIN; THIS APPLIES EQUALLY TO DECISIONS BY MEMBERSHIP AS IT DOES TO BOARD DECISIONS. SIMILARLY, I DON'T BELIEVE THE MEMBERSHIP CAN CAUSE THE CORPORATION TO ACT IN A WAY THAT VIOLATES ITS ARTICLES OF INCORPORATION OR BYLAWS; THIS LIMITS MEMBERSHIP JUST AS MUCH AS IT DOES THE BOARD, "FIDUCIARY DUTY" OR NO. FINALLY, WE COULD CONSIDER INSTITUTING A CONSULTATIVE PROCESS WHERE THE BOARD WOULD HAVE A LIMITED PERIOD OF TIME TO MAKE ITS CASE THAT IN EXERCISING ONE OF MEMBERSHIP'S POWERS (REMOVE/RECALL DIRECTORS, APPROVE/VETO BYLAWS, VETO BUDGET/STRAT PLAN/OP PLAN), THE MEMBERSHIP IS VIOLATING THE ARTICLES OR BYLAWS.
We're hearing a lot of wild claims about the member doing strange things, but I don't see how they're connected with our proposals. It's important to remember that our proposal doesn't empower the Single Member to *cause* the corporation to do anything positive at all, other than replace its directors - and the new directors would still have the same fiduciary duty as those they replace. The other powers are all powers of restraint. So this notion of the members distributing corporate assets is completely without foundation: only the Board can do that; the Single Member simply does not have the power to command the use of assets. I've got a more general complaint too. The CCWG predicted in advance this problem of vague and ill-defined criticism, and created a tool to resolve it into something more constructive: stress tests. Through the mechanism of stress testing we identify specific, concrete, comprehensible scenarios in which clearly defined adverse outcomes might occur, including a justification of why those outcomes are considered adverse. We can then use stress tests to check whether our proposal adequately mitigates those risks. We have tested our proposal against the 35 stress tests we have identified, and it passes each one. This is powerful support for our proposal's viability. Does the Board disagree with our evaluation of any of these stress tests? Which ones, and in what way? If not, can the Board identify any new stress tests that we should consider, adopting the same need for specificity in scenario construction? Or if not the Board, then anyone else? Clear answers to these questions would help drive our discussion forward in a constructive manner, as Greg puts it "helping us to tighten the bolts on the car". I think we would all welcome that. If no credible scenario can be imagined that bears inspection when codified into a stress test, then these vague accusations of "capture" "instability" and so forth must be assumed to be, quite literally, unjustifiable. Malcolm. P.S. Greg: notwithstanding my comments above, great post. -- Malcolm Hutty | tel: +44 20 7645 3523 Head of Public Affairs | Read the LINX Public Affairs blog London Internet Exchange | http://publicaffairs.linx.net/ London Internet Exchange Ltd 21-27 St Thomas Street, London SE1 9RY Company Registered in England No. 3137929 Trinity Court, Trinity Street, Peterborough PE1 1DA
participants (14)
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Aikman-Scalese, Anne -
Avri Doria -
Carlos Raul -
Carlos Raul Gutierrez -
Chris Disspain -
Greg Shatan -
James Gannon -
Jordan Carter -
Kavouss Arasteh -
Malcolm Hutty -
Phil Corwin -
Ron Baione -
Rubens Kuhl -
Seun Ojedeji