question on fiduciary duties and their objectivity
Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of "fiduciary duties" (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override "fiduciary duties" of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of "fiduciary duties" as it would provide the Board with an "arbitrary" power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions...) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge
Fairly certain there would be case law on this question, so if our counsel could flag Jorge's question, that would be very useful to the CCWG. arun On Thu, Oct 1, 2015 at 2:11 PM, <Jorge.Cancio@bakom.admin.ch> wrote:
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
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-- - @arunmsukumar <http://www.twitter.com/arunmsukumar> Senior Fellow, Centre for Communication Governance <http://www.ccgdelhi.org> National Law University, New Delhi Ph: +91-9871943272
During the face 2 face in LA, I was in a subgroup that has the community issue resolution escalation process similar to this; whereby as an escalation, there is an increase in the number of board members that could make the community's view implemented. Fortunately/coincidentally the group was lead by Chris and Greg, considering the status of the duo it was easy for me to believe it was workable ;-) By the way, that subgroup activity in LA was very helpful but doesn't seem to be taken to the next level by the Co-Chairs and that made it difficult for me to conclude that anything concrete was achieved in LA to move us forward. Regards Sent from my Asus Zenfone2 Kindly excuse brevity and typos. On 1 Oct 2015 09:42, <Jorge.Cancio@bakom.admin.ch> wrote:
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
Hi Seun, Jonathan Zuck volunteered to write up the outcome so that WP 1 can build on the results from LA. This is not forgotten. Hope this helps, Thomas --- rickert.net
Am 01.10.2015 um 18:11 schrieb Seun Ojedeji <seun.ojedeji@gmail.com>:
During the face 2 face in LA, I was in a subgroup that has the community issue resolution escalation process similar to this; whereby as an escalation, there is an increase in the number of board members that could make the community's view implemented. Fortunately/coincidentally the group was lead by Chris and Greg, considering the status of the duo it was easy for me to believe it was workable ;-)
By the way, that subgroup activity in LA was very helpful but doesn't seem to be taken to the next level by the Co-Chairs and that made it difficult for me to conclude that anything concrete was achieved in LA to move us forward.
Regards Sent from my Asus Zenfone2 Kindly excuse brevity and typos.
On 1 Oct 2015 09:42, <Jorge.Cancio@bakom.admin.ch> wrote: Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
oClarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws; · subjecting their correct interpretation to arbitration; · imposing special requirements on the rationale needed to be provided if they are used to override community decisions; · imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org Cc: leonfelipe@sanchez.mx; thomas@rickert.net Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
Dear Seue Unfortunately, dispute Resolution was a general term used and does it in no way replace IRP.Pls read my eralier message in this regard BR Kavouss 2015-10-02 11:43 GMT+02:00 <Jorge.Cancio@bakom.admin.ch>:
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:* Mathieu Weill [mailto:mathieu.weill@afnic.fr] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org *Cc:* leonfelipe@sanchez.mx; thomas@rickert.net *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april ( https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06
mathieu.weill@afnic.fr
Twitter : @mathieuweill
*****************************
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Dear Kavouss Are you adressing me or my question? Best Jorge Von: Kavouss Arasteh [mailto:kavouss.arasteh@gmail.com] Gesendet: Freitag, 2. Oktober 2015 12:08 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch>; Seun Ojedeji <seun.ojedeji@gmail.com> Cc: Mathieu Weill <Mathieu.Weill@afnic.fr>; accountability-cross-community@icann.org; Thomas Rickert <thomas@rickert.net> Betreff: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity Dear Seue Unfortunately, dispute Resolution was a general term used and does it in no way replace IRP.Pls read my eralier message in this regard BR Kavouss 2015-10-02 11:43 GMT+02:00 <Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch>>: Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: • concretizing these fiduciary duties in the Bylaws; • subjecting their correct interpretation to arbitration; • imposing special requirements on the rationale needed to be provided if they are used to override community decisions; • imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch>>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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
Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
·concretizing these fiduciary duties in the Bylaws;
·subjecting their correct interpretation to arbitration;
·imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
·imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:*Mathieu Weill [mailto:mathieu.weill@afnic.fr] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org *Cc:* leonfelipe@sanchez.mx; thomas@rickert.net *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
oClarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch <mailto:Jorge.Cancio@bakom.admin.ch> a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
Dear Mathieu That's absolutely right. The point is to deepen our understanding on the options at hand to subject the exercise of these duties to control within the legal architecture we are building. Regards Jorge Von meinem iPhone gesendet Am 02.10.2015 um 16:25 schrieb Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>>: Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws; · subjecting their correct interpretation to arbitration; · imposing special requirements on the rationale needed to be provided if they are used to override community decisions; · imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
Mathieu, I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" (https://en.wikipedia.org/wiki/Business_judgment_rule <https://en.wikipedia.org/wiki/Business_judgment_rule>) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction... ... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be. Rubens
Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill <mathieu.weill@afnic.fr> escreveu:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch <mailto:Jorge.Cancio@bakom.admin.ch> a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr>] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch> <mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org <mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx <mailto:leonfelipe@sanchez.mx>; thomas@rickert.net <mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20... <https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...>) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch <mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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 <https://mm.icann.org/mailman/listinfo/accountability-cross-community>
I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty. The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand. Greg On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br> wrote:
Mathieu,
I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" ( https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction...
... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be.
Rubens
Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill <mathieu.weill@afnic.fr> escreveu:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:* Mathieu Weill [mailto:mathieu.weill@afnic.fr <mathieu.weill@afnic.fr>] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch> <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org *Cc:* leonfelipe@sanchez.mx; thomas@rickert.net *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april ( https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06
mathieu.weill@afnic.fr
Twitter : @mathieuweill
*****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
Dear All, What Jorge asking is legitimate question but ,the way he wishes to enforce them is very complex as he wants to include parts of California Corporate law relating to fiduciary in the ICANN Bylaws. According to applicable international law one can not subordinate an international agreement ( such as ICANN Bylaws ) to national or even lowe than national ( state laws) . Moreover, one can not link one agreement to any provision that may change in future such as California corporate law as it may change in future which automatically requires adjustment of ICANN Bylaws to cover the changes ,if agreed by the community Thirdly I support the valid analysis provided by Geg Tks Kavouss 2015-10-02 17:06 GMT+02:00 Greg Shatan <gregshatanipc@gmail.com>:
I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty.
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
Greg
On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br> wrote:
Mathieu,
I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" ( https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction...
... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be.
Rubens
Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill < mathieu.weill@afnic.fr> escreveu:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:* Mathieu Weill [mailto:mathieu.weill@afnic.fr <mathieu.weill@afnic.fr>] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch> <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org *Cc:* leonfelipe@sanchez.mx; thomas@rickert.net *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april ( https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06
mathieu.weill@afnic.fr
Twitter : @mathieuweill
*****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
The ICANN bylaws are not an international agreement, they are expressly subject to Californian/US statutes. If California corporate law changes then yes ICANN will be bound to also change with it, that’s one thing I don;t think the CCWG is able to change unless we want to add running for public office to our list of goals! -James From: <accountability-cross-community-bounces@icann.org<mailto:accountability-cross-community-bounces@icann.org>> on behalf of Kavouss Arasteh Date: Friday 2 October 2015 20:05 To: Greg Shatan, "<Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch>>" Cc: Thomas Rickert, "accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org>" Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity Dear All, What Jorge asking is legitimate question but ,the way he wishes to enforce them is very complex as he wants to include parts of California Corporate law relating to fiduciary in the ICANN Bylaws. According to applicable international law one can not subordinate an international agreement ( such as ICANN Bylaws ) to national or even lowe than national ( state laws) . Moreover, one can not link one agreement to any provision that may change in future such as California corporate law as it may change in future which automatically requires adjustment of ICANN Bylaws to cover the changes ,if agreed by the community Thirdly I support the valid analysis provided by Geg Tks Kavouss 2015-10-02 17:06 GMT+02:00 Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>>: I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty. The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand. Greg On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br<mailto:rubensk@nic.br>> wrote: Mathieu, I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" (https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction... ... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be. Rubens Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> escreveu: Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws; · subjecting their correct interpretation to arbitration; · imposing special requirements on the rationale needed to be provided if they are used to override community decisions; · imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006>mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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 _______________________________________________ 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 _______________________________________________ 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
Dear all, As you know various participants (including me) have worked for the issue of jurisdiction to be included under WS2. However, all our present analysis at this stage and in WS1 are based on the arcane art of californian corporate law. That's the reason why my questions asks about solutions/options within that specific body of law. regards Jorge Von meinem iPhone gesendet Am 02.10.2015 um 21:25 schrieb James Gannon <james@cyberinvasion.net<mailto:james@cyberinvasion.net>>: The ICANN bylaws are not an international agreement, they are expressly subject to Californian/US statutes. If California corporate law changes then yes ICANN will be bound to also change with it, that’s one thing I don;t think the CCWG is able to change unless we want to add running for public office to our list of goals! -James From: <accountability-cross-community-bounces@icann.org<mailto:accountability-cross-community-bounces@icann.org>> on behalf of Kavouss Arasteh Date: Friday 2 October 2015 20:05 To: Greg Shatan, "<Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch>>" Cc: Thomas Rickert, "accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org>" Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity Dear All, What Jorge asking is legitimate question but ,the way he wishes to enforce them is very complex as he wants to include parts of California Corporate law relating to fiduciary in the ICANN Bylaws. According to applicable international law one can not subordinate an international agreement ( such as ICANN Bylaws ) to national or even lowe than national ( state laws) . Moreover, one can not link one agreement to any provision that may change in future such as California corporate law as it may change in future which automatically requires adjustment of ICANN Bylaws to cover the changes ,if agreed by the community Thirdly I support the valid analysis provided by Geg Tks Kavouss 2015-10-02 17:06 GMT+02:00 Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>>: I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty. The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand. Greg On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br<mailto:rubensk@nic.br>> wrote: Mathieu, I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" (https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction... ... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be. Rubens Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> escreveu: Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws; · subjecting their correct interpretation to arbitration; · imposing special requirements on the rationale needed to be provided if they are used to override community decisions; · imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006>mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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 _______________________________________________ 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 _______________________________________________ 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
+1 that reflects my understanding of your question Jorge. -James On 02/10/2015 20:33, "Jorge.Cancio@bakom.admin.ch" <Jorge.Cancio@bakom.admin.ch> wrote:
Dear all, As you know various participants (including me) have worked for the issue of jurisdiction to be included under WS2. However, all our present analysis at this stage and in WS1 are based on the arcane art of californian corporate law. That's the reason why my questions asks about solutions/options within that specific body of law. regards Jorge
Von meinem iPhone gesendet
Am 02.10.2015 um 21:25 schrieb James Gannon <james@cyberinvasion.net<mailto:james@cyberinvasion.net>>:
The ICANN bylaws are not an international agreement, they are expressly subject to Californian/US statutes. If California corporate law changes then yes ICANN will be bound to also change with it, that’s one thing I don;t think the CCWG is able to change unless we want to add running for public office to our list of goals!
-James
From: <accountability-cross-community-bounces@icann.org<mailto:accountability-cross-community-bounces@icann.org>> on behalf of Kavouss Arasteh Date: Friday 2 October 2015 20:05 To: Greg Shatan, "<Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch>>" Cc: Thomas Rickert, "accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org>" Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity
Dear All, What Jorge asking is legitimate question but ,the way he wishes to enforce them is very complex as he wants to include parts of California Corporate law relating to fiduciary in the ICANN Bylaws. According to applicable international law one can not subordinate an international agreement ( such as ICANN Bylaws ) to national or even lowe than national ( state laws) . Moreover, one can not link one agreement to any provision that may change in future such as California corporate law as it may change in future which automatically requires adjustment of ICANN Bylaws to cover the changes ,if agreed by the community Thirdly I support the valid analysis provided by Geg Tks Kavouss
2015-10-02 17:06 GMT+02:00 Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>>: I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty.
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
Greg
On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br<mailto:rubensk@nic.br>> wrote:
Mathieu,
I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" (https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction...
... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be.
Rubens
Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> escreveu:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006>
mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>
Twitter : @mathieuweill
*****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006>mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
_______________________________________________ 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
_______________________________________________ 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
_______________________________________________ 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
James, Thank you mentioning that the ICANN Bylaws is totally sub ordinated by Californioa Laws Then why we need to discuss the issue of jurisdiction knowing that california laws prevails in all cases and Under any circumstances ICG, CCWG and CWG . let us bow down to California law Why we spent so much time to amend ICANN Bylaws Inefficient efforts Let us ask the California State to draft the ICANN Bylaws for us It is a pity that we are living in a colonial and dominating and high jacking environment Thanks to people giving us the advice that we are doing something totally inefficient.
From the very beginning we are captured by California Laws and Jurisdiction.
According to what you said we need first to resolve the issue of jurisdiction before doing any thing else Best Regard and have a nice week-end Cheers Kavouss 2015-10-02 21:34 GMT+02:00 James Gannon <james@cyberinvasion.net>:
+1 that reflects my understanding of your question Jorge.
-James
On 02/10/2015 20:33, "Jorge.Cancio@bakom.admin.ch" < Jorge.Cancio@bakom.admin.ch> wrote:
Dear all, As you know various participants (including me) have worked for the issue of jurisdiction to be included under WS2. However, all our present analysis at this stage and in WS1 are based on the arcane art of californian corporate law. That's the reason why my questions asks about solutions/options within that specific body of law. regards Jorge
Von meinem iPhone gesendet
Am 02.10.2015 um 21:25 schrieb James Gannon <james@cyberinvasion.net <mailto:james@cyberinvasion.net>>:
The ICANN bylaws are not an international agreement, they are expressly subject to Californian/US statutes. If California corporate law changes then yes ICANN will be bound to also change with it, that’s one thing I don;t think the CCWG is able to change unless we want to add running for public office to our list of goals!
-James
From: <accountability-cross-community-bounces@icann.org<mailto: accountability-cross-community-bounces@icann.org>> on behalf of Kavouss Arasteh Date: Friday 2 October 2015 20:05 To: Greg Shatan, "<Jorge.Cancio@bakom.admin.ch<mailto: Jorge.Cancio@bakom.admin.ch>>" Cc: Thomas Rickert, "accountability-cross-community@icann.org<mailto: accountability-cross-community@icann.org>" Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity
Dear All, What Jorge asking is legitimate question but ,the way he wishes to enforce them is very complex as he wants to include parts of California Corporate law relating to fiduciary in the ICANN Bylaws. According to applicable international law one can not subordinate an international agreement ( such as ICANN Bylaws ) to national or even lowe than national ( state laws) . Moreover, one can not link one agreement to any provision that may change in future such as California corporate law as it may change in future which automatically requires adjustment of ICANN Bylaws to cover the changes ,if agreed by the community Thirdly I support the valid analysis provided by Geg Tks Kavouss
2015-10-02 17:06 GMT+02:00 Greg Shatan <gregshatanipc@gmail.com<mailto: gregshatanipc@gmail.com>>: I believe the business judgment rule gets interpreted somewhat differently in the non-profit context, since the duties of a non-profit director are not solely to the corporation, but need to take into account the public benefit for which the corporation was established. It's all part of the bigger question about fiduciary duty.
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
Greg
On Fri, Oct 2, 2015 at 10:43 AM, Rubens Kuhl <rubensk@nic.br<mailto: rubensk@nic.br>> wrote:
Mathieu,
I think Jorge might be wanting the opposite of what you described, which is imposing constraints in fiduciary duties trumping community interests. Either way, it could also be interesting to understand if under California law the "business judgment rule" ( https://en.wikipedia.org/wiki/Business_judgment_rule) could allow a board member to choose a course of action that contradicts the corporation interests, as long as it follows community interests. Even though the Bylaws already contain deference to such community interests, in real life a board member might feel under pressure of the corporate machine to follow such a direction...
... I also wonder whether what the CCWG has, independent Legal Counsel, also could be useful to board members so they can be assured that they can vote with the community best interest in mind, when the corporation starts pushing toward a direction that does not fit the community or his/her own beliefs of where global public interest would be.
Rubens
Em 2 de out de 2015, à(s) 11:25:000, Mathieu Weill < mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> escreveu:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto: Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto: Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org <mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april ( https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto: Jorge.Cancio@bakom.admin.ch> a écrit : Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
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-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill *****************************
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Hello Greg,
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
My understanding is that Board directors already have that right. Note that several of our Board members are lawyers (although not in California), and several Board members have access to their own legal counsel through their employment. I don’t recall in the time I have been on the Board that a Board member has sought independent counsel (which would be paid for by ICANN) - but I believe that it is available. Certainly in this process I have spoken directly over lunch, morning tea etc with many of the lawyers involved – participants of the CCWG, members of the CCWG, legal counsel to the CCWG, lawyers on the Board, ICANN’s in-house lawyers, ICANN.s external counsel etc. I listen to them all, and I read all the posts. This is my current understanding of the fiduciary responsibility from the Articles of Association: " In furtherance of the foregoing purposes, and in recognition of the fact that the Internet is an international network of networks, owned by no single nation, individual or organization, the Corporation shall, except as limited by Article 5 hereof, pursue the charitable and public purposes of lessening the burdens of government and promoting the global public interest in the operational stability of the Internet by (i) coordinating the assignment of Internet technical parameters as needed to maintain universal connectivity on the Internet; (ii) performing and overseeing functions related to the coordination of the Internet Protocol ("IP") address space; (iii) performing and overseeing functions related to the coordination of the Internet domain name system ("DNS"), including the development of policies for determining the circumstances under which new top-level domains are added to the DNS root system; (iv) overseeing operation of the authoritative Internet DNS root server system; and (v) engaging in any other related lawful activity in furtherance of items (i) through (iv). The Corporation shall operate for the benefit of the Internet community as a whole, carrying out its activities in conformity with relevant principles of international law and applicable international conventions and local law and, to the extent appropriate and consistent with these Articles and its Bylaws, through open and transparent processes that enable competition and open entry in Internet-related markets. To this effect, the Corporation shall cooperate as appropriate with relevant international organizations." In short hand: the Board's fiduciary responsibility is towards the Internet community as a whole, and must promote the global public interest in the operational stability of the Internet. Most of us on the Board don’t actually need lawyers to tell us how to exercise that responsibility. I can see that the Board may at times be in conflict with any one SO or AC with respect to that responsibility, but if there is a consensus of SOs and ACs has a view about an action the Board is taking with respect to the operational stability of the Internet - then I can't imagine a situation where the Board would do something differently. Regards, Bruce Tonkin
Bruce, The reason that a Board would retain counsel independent of the corporation is rather more specific, and not really addressed by your response. A Board (or a Board committee) would retain independent counsel to receive advice that is independent of the corporation and independent of the counsel retained by the corporation. This is most typical when the Board (or a committee) is investigating activities or actions of the corporation (as distinct from actions of the Board), but it can and may be invoked any time the Board is concerned about getting advice that is independent of management and its retained counsel, including getting a "second opinion" on advice the Board is receiving from the corporation's counsel. The corollary to this is that a Board is not required to take the advice of the corporation's counsel at "face value," but can retain its own counsel. Greg Greg On Fri, Oct 2, 2015 at 9:50 PM, Bruce Tonkin < Bruce.Tonkin@melbourneit.com.au> wrote:
Hello Greg,
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
My understanding is that Board directors already have that right.
Note that several of our Board members are lawyers (although not in California), and several Board members have access to their own legal counsel through their employment.
I don’t recall in the time I have been on the Board that a Board member has sought independent counsel (which would be paid for by ICANN) - but I believe that it is available.
Certainly in this process I have spoken directly over lunch, morning tea etc with many of the lawyers involved – participants of the CCWG, members of the CCWG, legal counsel to the CCWG, lawyers on the Board, ICANN’s in-house lawyers, ICANN.s external counsel etc. I listen to them all, and I read all the posts.
This is my current understanding of the fiduciary responsibility from the Articles of Association:
" In furtherance of the foregoing purposes, and in recognition of the fact that the Internet is an international network of networks, owned by no single nation, individual or organization, the Corporation shall, except as limited by Article 5 hereof, pursue the charitable and public purposes of lessening the burdens of government and promoting the global public interest in the operational stability of the Internet by
(i) coordinating the assignment of Internet technical parameters as needed to maintain universal connectivity on the Internet;
(ii) performing and overseeing functions related to the coordination of the Internet Protocol ("IP") address space;
(iii) performing and overseeing functions related to the coordination of the Internet domain name system ("DNS"), including the development of policies for determining the circumstances under which new top-level domains are added to the DNS root system; (iv) overseeing operation of the authoritative Internet DNS root server system; and
(v) engaging in any other related lawful activity in furtherance of items (i) through (iv).
The Corporation shall operate for the benefit of the Internet community as a whole, carrying out its activities in conformity with relevant principles of international law and applicable international conventions and local law and, to the extent appropriate and consistent with these Articles and its Bylaws, through open and transparent processes that enable competition and open entry in Internet-related markets. To this effect, the Corporation shall cooperate as appropriate with relevant international organizations."
In short hand: the Board's fiduciary responsibility is towards the Internet community as a whole, and must promote the global public interest in the operational stability of the Internet.
Most of us on the Board don’t actually need lawyers to tell us how to exercise that responsibility.
I can see that the Board may at times be in conflict with any one SO or AC with respect to that responsibility, but if there is a consensus of SOs and ACs has a view about an action the Board is taking with respect to the operational stability of the Internet - then I can't imagine a situation where the Board would do something differently.
Regards, Bruce Tonkin
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Thanks Greg. That matches my understanding also. My point is the board already had that right. We are in effect getting some independent advice from the CCWG legal counsel through this process. Sent from my iPhone On 5 Oct 2015, at 9:02 PM, Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>> wrote: Bruce, The reason that a Board would retain counsel independent of the corporation is rather more specific, and not really addressed by your response. A Board (or a Board committee) would retain independent counsel to receive advice that is independent of the corporation and independent of the counsel retained by the corporation. This is most typical when the Board (or a committee) is investigating activities or actions of the corporation (as distinct from actions of the Board), but it can and may be invoked any time the Board is concerned about getting advice that is independent of management and its retained counsel, including getting a "second opinion" on advice the Board is receiving from the corporation's counsel. The corollary to this is that a Board is not required to take the advice of the corporation's counsel at "face value," but can retain its own counsel. Greg Greg On Fri, Oct 2, 2015 at 9:50 PM, Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au<mailto:Bruce.Tonkin@melbourneit.com.au>> wrote: Hello Greg,
The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
My understanding is that Board directors already have that right. Note that several of our Board members are lawyers (although not in California), and several Board members have access to their own legal counsel through their employment. I don’t recall in the time I have been on the Board that a Board member has sought independent counsel (which would be paid for by ICANN) - but I believe that it is available. Certainly in this process I have spoken directly over lunch, morning tea etc with many of the lawyers involved – participants of the CCWG, members of the CCWG, legal counsel to the CCWG, lawyers on the Board, ICANN’s in-house lawyers, ICANN.s external counsel etc. I listen to them all, and I read all the posts. This is my current understanding of the fiduciary responsibility from the Articles of Association: " In furtherance of the foregoing purposes, and in recognition of the fact that the Internet is an international network of networks, owned by no single nation, individual or organization, the Corporation shall, except as limited by Article 5 hereof, pursue the charitable and public purposes of lessening the burdens of government and promoting the global public interest in the operational stability of the Internet by (i) coordinating the assignment of Internet technical parameters as needed to maintain universal connectivity on the Internet; (ii) performing and overseeing functions related to the coordination of the Internet Protocol ("IP") address space; (iii) performing and overseeing functions related to the coordination of the Internet domain name system ("DNS"), including the development of policies for determining the circumstances under which new top-level domains are added to the DNS root system; (iv) overseeing operation of the authoritative Internet DNS root server system; and (v) engaging in any other related lawful activity in furtherance of items (i) through (iv). The Corporation shall operate for the benefit of the Internet community as a whole, carrying out its activities in conformity with relevant principles of international law and applicable international conventions and local law and, to the extent appropriate and consistent with these Articles and its Bylaws, through open and transparent processes that enable competition and open entry in Internet-related markets. To this effect, the Corporation shall cooperate as appropriate with relevant international organizations." In short hand: the Board's fiduciary responsibility is towards the Internet community as a whole, and must promote the global public interest in the operational stability of the Internet. Most of us on the Board don’t actually need lawyers to tell us how to exercise that responsibility. I can see that the Board may at times be in conflict with any one SO or AC with respect to that responsibility, but if there is a consensus of SOs and ACs has a view about an action the Board is taking with respect to the operational stability of the Internet - then I can't imagine a situation where the Board would do something differently. Regards, Bruce Tonkin _______________________________________________ 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
Hi, Maybe someone mentioned it and I missed it, but how many directors have retained counsel in our history. More than 1 or 2? avri On 05-Oct-15 07:07, Bruce Tonkin wrote:
Thanks Greg. That matches my understanding also.
My point is the board already had that right. We are in effect getting some independent advice from the CCWG legal counsel through this process.
Sent from my iPhone
On 5 Oct 2015, at 9:02 PM, Greg Shatan <gregshatanipc@gmail.com <mailto:gregshatanipc@gmail.com>> wrote:
Bruce,
The reason that a Board would retain counsel independent of the corporation is rather more specific, and not really addressed by your response. A Board (or a Board committee) would retain independent counsel to receive advice that is independent of the corporation and independent of the counsel retained by the corporation. This is most typical when the Board (or a committee) is investigating activities or actions of the corporation (as distinct from actions of the Board), but it can and may be invoked any time the Board is concerned about getting advice that is independent of management and its retained counsel, including getting a "second opinion" on advice the Board is receiving from the corporation's counsel.
The corollary to this is that a Board is not required to take the advice of the corporation's counsel at "face value," but can retain its own counsel.
Greg
Greg
On Fri, Oct 2, 2015 at 9:50 PM, Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au <mailto:Bruce.Tonkin@melbourneit.com.au>> wrote:
Hello Greg,
>> The idea of independent counsel for board members is an interesting one. It's not uncommon in the corporate governance world, as far as I understand.
My understanding is that Board directors already have that right.
Note that several of our Board members are lawyers (although not in California), and several Board members have access to their own legal counsel through their employment.
I don’t recall in the time I have been on the Board that a Board member has sought independent counsel (which would be paid for by ICANN) - but I believe that it is available.
Certainly in this process I have spoken directly over lunch, morning tea etc with many of the lawyers involved – participants of the CCWG, members of the CCWG, legal counsel to the CCWG, lawyers on the Board, ICANN’s in-house lawyers, ICANN.s external counsel etc. I listen to them all, and I read all the posts.
This is my current understanding of the fiduciary responsibility from the Articles of Association:
" In furtherance of the foregoing purposes, and in recognition of the fact that the Internet is an international network of networks, owned by no single nation, individual or organization, the Corporation shall, except as limited by Article 5 hereof, pursue the charitable and public purposes of lessening the burdens of government and promoting the global public interest in the operational stability of the Internet by
(i) coordinating the assignment of Internet technical parameters as needed to maintain universal connectivity on the Internet;
(ii) performing and overseeing functions related to the coordination of the Internet Protocol ("IP") address space;
(iii) performing and overseeing functions related to the coordination of the Internet domain name system ("DNS"), including the development of policies for determining the circumstances under which new top-level domains are added to the DNS root system; (iv) overseeing operation of the authoritative Internet DNS root server system; and
(v) engaging in any other related lawful activity in furtherance of items (i) through (iv).
The Corporation shall operate for the benefit of the Internet community as a whole, carrying out its activities in conformity with relevant principles of international law and applicable international conventions and local law and, to the extent appropriate and consistent with these Articles and its Bylaws, through open and transparent processes that enable competition and open entry in Internet-related markets. To this effect, the Corporation shall cooperate as appropriate with relevant international organizations."
In short hand: the Board's fiduciary responsibility is towards the Internet community as a whole, and must promote the global public interest in the operational stability of the Internet.
Most of us on the Board don’t actually need lawyers to tell us how to exercise that responsibility.
I can see that the Board may at times be in conflict with any one SO or AC with respect to that responsibility, but if there is a consensus of SOs and ACs has a view about an action the Board is taking with respect to the operational stability of the Internet - then I can't imagine a situation where the Board would do something differently.
Regards, Bruce Tonkin
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Hello Avri.
Maybe someone mentioned it and I missed it, but how many directors have retained counsel in our history.
More than 1 or 2?
From my recollection that sounds about right.
I will check with the General Counsel's office to see if they have some data. Regards, Bruce Tonkin
Bruce, I would like to clarify a few things for purposes of this discussion about a Board engaging independent counsel. First there is a very significant difference between individual directors engaging independent counsel and a Board engaging independent counsel. Typically, in the first instance, the director is seeking counsel with some distance and independence from the Board. In the second instance, the Board as a body is seeking advice independent of the corporation's counsel. The question of whether individual directors have retained independent counsel is not really relevant to this discussion about the Board seeking independent legal advice. It's also important to note that legal advice arises in an attorney-client relationship, which can be created by a lawyer giving legal advice as well as by an intentional act of engaging counsel. While there may be lawyers on the ICANN Board, they are not acting in that capacity, they are acting as directors. As such, they should not be providing legal advice, and their thoughts about legal matters should not be considered legal advice. If board members are trying to wear both hats, that creates confusion (at best) because it is unclear when they are acting as directors and when they are acting as lawyers in an attorney-client relationship. Being a lawyer who has sat on some non-profit boards, it's my understanding that the usual advice is to be extra careful NOT to provide legal advice. The situation is also treacherous when directors consult with the lawyers their employer retains in their "day job" context. For instance, directors should not be sharing confidential information about board matters outside the board room. This scenario also raises questions about who the "client" is and if or when an attorney-client relationship arises. At best, these situations should be considered legal "kibitizing"* and not legal advice, and the recipient of the kibitzing should not rely on it as legal advice. In other words, none of this is a substitute for actual legal advice from an attorney engaged for that purpose. At worst, these situations can cause quite a bit of mess. Greg [CAVEAT: This email (and all other emails I have sent or will send) do not constitute legal advice, should not be relied on as such, and do not create an attorney-client relationship.] * Kibitzing: Giving casual (and sometimes unrequested) advice as a bystander. On Mon, Oct 5, 2015 at 2:27 PM, Bruce Tonkin < Bruce.Tonkin@melbourneit.com.au> wrote:
Hello Avri.
Maybe someone mentioned it and I missed it, but how many directors have retained counsel in our history.
More than 1 or 2?
From my recollection that sounds about right.
I will check with the General Counsel's office to see if they have some data.
Regards, Bruce Tonkin
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Understood. I think we are in strong agreement. I am a little lost actually as I think the original topic was that the Board should be able to engage independent Counsel. My point is that I think that is already within the powers of an individual director and of the Board. Perhaps what you are saying is that the Board should take that step more often? Regards, Bruce Tonkin From: Greg Shatan [mailto:gregshatanipc@gmail.com] Sent: Tuesday, 6 October 2015 2:48 PM To: Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au> Cc: accountability-cross-community@icann.org Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity Bruce, I would like to clarify a few things for purposes of this discussion about a Board engaging independent counsel. First there is a very significant difference between individual directors engaging independent counsel and a Board engaging independent counsel. Typically, in the first instance, the director is seeking counsel with some distance and independence from the Board. In the second instance, the Board as a body is seeking advice independent of the corporation's counsel. The question of whether individual directors have retained independent counsel is not really relevant to this discussion about the Board seeking independent legal advice. It's also important to note that legal advice arises in an attorney-client relationship, which can be created by a lawyer giving legal advice as well as by an intentional act of engaging counsel. While there may be lawyers on the ICANN Board, they are not acting in that capacity, they are acting as directors. As such, they should not be providing legal advice, and their thoughts about legal matters should not be considered legal advice. If board members are trying to wear both hats, that creates confusion (at best) because it is unclear when they are acting as directors and when they are acting as lawyers in an attorney-client relationship. Being a lawyer who has sat on some non-profit boards, it's my understanding that the usual advice is to be extra careful NOT to provide legal advice. The situation is also treacherous when directors consult with the lawyers their employer retains in their "day job" context. For instance, directors should not be sharing confidential information about board matters outside the board room. This scenario also raises questions about who the "client" is and if or when an attorney-client relationship arises. At best, these situations should be considered legal "kibitizing"* and not legal advice, and the recipient of the kibitzing should not rely on it as legal advice. In other words, none of this is a substitute for actual legal advice from an attorney engaged for that purpose. At worst, these situations can cause quite a bit of mess. Greg [CAVEAT: This email (and all other emails I have sent or will send) do not constitute legal advice, should not be relied on as such, and do not create an attorney-client relationship.] * Kibitzing: Giving casual (and sometimes unrequested) advice as a bystander. On Mon, Oct 5, 2015 at 2:27 PM, Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au<mailto:Bruce.Tonkin@melbourneit.com.au>> wrote: Hello Avri.
Maybe someone mentioned it and I missed it, but how many directors have retained counsel in our history.
More than 1 or 2?
From my recollection that sounds about right. I will check with the General Counsel's office to see if they have some data. Regards, Bruce Tonkin _______________________________________________ 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
I am not really sure why this should be relevant, as I would say that it is up to the board or individual board members from whom they seek there advice since they themselves are accountable for the decisions they base on such advice. However, Greg, if all is well, board members are (s)elected primarily on their expertise, experience and personal competences. It would be a disservice to the board and the community if the professional opinion of a board member, based on personal expertise on a matter, could not be used as advice to the (rest of the) board. It’s the whole idea of having a diverse board with different fields of (extensive) expertise. Law and otherwise. Best, Roelof Meijer From: <accountability-cross-community-bounces@icann.org<mailto:accountability-cross-community-bounces@icann.org>> on behalf of Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>> Date: dinsdag 6 oktober 2015 05:48 To: Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au<mailto:Bruce.Tonkin@melbourneit.com.au>> Cc: "accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org>" <accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org>> Subject: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity Bruce, I would like to clarify a few things for purposes of this discussion about a Board engaging independent counsel. First there is a very significant difference between individual directors engaging independent counsel and a Board engaging independent counsel. Typically, in the first instance, the director is seeking counsel with some distance and independence from the Board. In the second instance, the Board as a body is seeking advice independent of the corporation's counsel. The question of whether individual directors have retained independent counsel is not really relevant to this discussion about the Board seeking independent legal advice. It's also important to note that legal advice arises in an attorney-client relationship, which can be created by a lawyer giving legal advice as well as by an intentional act of engaging counsel. While there may be lawyers on the ICANN Board, they are not acting in that capacity, they are acting as directors. As such, they should not be providing legal advice, and their thoughts about legal matters should not be considered legal advice. If board members are trying to wear both hats, that creates confusion (at best) because it is unclear when they are acting as directors and when they are acting as lawyers in an attorney-client relationship. Being a lawyer who has sat on some non-profit boards, it's my understanding that the usual advice is to be extra careful NOT to provide legal advice. The situation is also treacherous when directors consult with the lawyers their employer retains in their "day job" context. For instance, directors should not be sharing confidential information about board matters outside the board room. This scenario also raises questions about who the "client" is and if or when an attorney-client relationship arises. At best, these situations should be considered legal "kibitizing"* and not legal advice, and the recipient of the kibitzing should not rely on it as legal advice. In other words, none of this is a substitute for actual legal advice from an attorney engaged for that purpose. At worst, these situations can cause quite a bit of mess. Greg [CAVEAT: This email (and all other emails I have sent or will send) do not constitute legal advice, should not be relied on as such, and do not create an attorney-client relationship.] * Kibitzing: Giving casual (and sometimes unrequested) advice as a bystander. On Mon, Oct 5, 2015 at 2:27 PM, Bruce Tonkin <Bruce.Tonkin@melbourneit.com.au<mailto:Bruce.Tonkin@melbourneit.com.au>> wrote: Hello Avri.
Maybe someone mentioned it and I missed it, but how many directors have retained counsel in our history.
More than 1 or 2?
From my recollection that sounds about right.
I will check with the General Counsel's office to see if they have some data. Regards, Bruce Tonkin _______________________________________________ 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
I am quite confident that there are standards (objective or otherwise) for the definition and exercise of "fiduciary duty" by directors, both in the statutes and in case law, as well as in commentary (i.e., books and articles) and legal advice. Of course, the advice that the Board has received over the years in applying "fiduciary duty" as an ICANN Board member almost certainly takes a particular view of the legal standards and their application. Our counsel may well take a different view. We should get our counsel's view (and if possible, our counsel's view on ICANN's counsel's view). As a general matter, Boards are bound to to make all their decisions consistent with their fiduciary duties. This does not need to be set out in any document. It's a legal duty. Our issues don't focus on this overall exercise of fiduciary duty; rather, I think our primary concern is when the Board invokes fiduciary duty as a reason not to accept the recommendations, advice or decisions of the community or any part thereof. After that comes the question of whether and how to bind the ICANN Board to specific and explicit standards or interpretations for fiduciary duty, rather than relying on an unstated interpretation based on the advice of counsel. Then comes the questions of whether the Bylaws can include any specific requirements (e.g., extended rationale, supermajority) when the Board goes against the decisions of the Community and does so based on "fiduciary duty." After that comes the question of whether the Board's exercise of fiduciary duty can be challenged in RfR, IAP, MEM, etc. Finally, the question comes whether this challenge would be significantly different if brought by the Sole Member vs. any other entity. I don't believe "enforceability" hinges primarily on whether there are explicit standards for fiduciary duty set forth in the bylaws. As noted above, it is an inherent duty. If a Board violates its fiduciary duty, a party with standing (i.e., affected by the outcome) and the capacity to sue (i.e., legal personhood) can challenge that in court. However, explicit standards may make "enforceability" easier, since the complainant could point to specific bylaws that have been violated, rather than challenging the board's interpretation of fiduciary duty. Since there are a range of interpretations of fiduciary duty, and the Board has broad (but not boundless) discretion to interpret fiduciary duty, it becomes more difficult to challenge -- but not impossible, since some actions objectively violate fiduciary duty based on existing legal standards (e.g., if the Board exhausts its reserve fund to pay for trip to Las Vegas, any claim that this is consistent with their fiduciary duty is likely to fail). I hope this helps inform the questions we need to ask counsel in this situation. There is also a second question arising from Jorge's email, which is: What are the duties and obligations that must be considered when the *membership* makes a decision. Are the decisions of membership (in a California public benefit corp.) utterly arbitrary and without regard to any standard, or are they limited by some legal standards or duties? If so, what are those standards and duties? If there is no legal standard for member's decisions, how can these decision-making powers be constrained, e.g., in the Articles/Bylaws of the corporation, and what standards and mechanisms would typically be used to do so? This should be explored as well. Greg On Fri, Oct 2, 2015 at 10:25 AM, Mathieu Weill <mathieu.weill@afnic.fr> wrote:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:* Mathieu Weill [mailto:mathieu.weill@afnic.fr <mathieu.weill@afnic.fr>] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch> <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org *Cc:* leonfelipe@sanchez.mx; thomas@rickert.net *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april ( https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06
mathieu.weill@afnic.fr
Twitter : @mathieuweill
*****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
_______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community
I feel Greg captures and explains (much more eloquently) the issues I think we should be clarifying. Thanks! Jorge Von meinem iPhone gesendet Am 02.10.2015 um 16:52 schrieb Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>>: I am quite confident that there are standards (objective or otherwise) for the definition and exercise of "fiduciary duty" by directors, both in the statutes and in case law, as well as in commentary (i.e., books and articles) and legal advice. Of course, the advice that the Board has received over the years in applying "fiduciary duty" as an ICANN Board member almost certainly takes a particular view of the legal standards and their application. Our counsel may well take a different view. We should get our counsel's view (and if possible, our counsel's view on ICANN's counsel's view). As a general matter, Boards are bound to to make all their decisions consistent with their fiduciary duties. This does not need to be set out in any document. It's a legal duty. Our issues don't focus on this overall exercise of fiduciary duty; rather, I think our primary concern is when the Board invokes fiduciary duty as a reason not to accept the recommendations, advice or decisions of the community or any part thereof. After that comes the question of whether and how to bind the ICANN Board to specific and explicit standards or interpretations for fiduciary duty, rather than relying on an unstated interpretation based on the advice of counsel. Then comes the questions of whether the Bylaws can include any specific requirements (e.g., extended rationale, supermajority) when the Board goes against the decisions of the Community and does so based on "fiduciary duty." After that comes the question of whether the Board's exercise of fiduciary duty can be challenged in RfR, IAP, MEM, etc. Finally, the question comes whether this challenge would be significantly different if brought by the Sole Member vs. any other entity. I don't believe "enforceability" hinges primarily on whether there are explicit standards for fiduciary duty set forth in the bylaws. As noted above, it is an inherent duty. If a Board violates its fiduciary duty, a party with standing (i.e., affected by the outcome) and the capacity to sue (i.e., legal personhood) can challenge that in court. However, explicit standards may make "enforceability" easier, since the complainant could point to specific bylaws that have been violated, rather than challenging the board's interpretation of fiduciary duty. Since there are a range of interpretations of fiduciary duty, and the Board has broad (but not boundless) discretion to interpret fiduciary duty, it becomes more difficult to challenge -- but not impossible, since some actions objectively violate fiduciary duty based on existing legal standards (e.g., if the Board exhausts its reserve fund to pay for trip to Las Vegas, any claim that this is consistent with their fiduciary duty is likely to fail). I hope this helps inform the questions we need to ask counsel in this situation. There is also a second question arising from Jorge's email, which is: What are the duties and obligations that must be considered when the membership makes a decision. Are the decisions of membership (in a California public benefit corp.) utterly arbitrary and without regard to any standard, or are they limited by some legal standards or duties? If so, what are those standards and duties? If there is no legal standard for member's decisions, how can these decision-making powers be constrained, e.g., in the Articles/Bylaws of the corporation, and what standards and mechanisms would typically be used to do so? This should be explored as well. Greg [https://ssl.gstatic.com/ui/v1/icons/mail/images/cleardot.gif] On Fri, Oct 2, 2015 at 10:25 AM, Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> wrote: Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I’ve tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: • concretizing these fiduciary duties in the Bylaws; • subjecting their correct interpretation to arbitration; • imposing special requirements on the rationale needed to be provided if they are used to override community decisions; • imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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
Dear Co-Chairs, May you please kindly confirm that this question will be certified to our lawyers? Thanks and best regards Jorge Von: Cancio Jorge BAKOM Gesendet: Freitag, 2. Oktober 2015 17:02 An: Greg Shatan <gregshatanipc@gmail.com> Cc: Mathieu Weill <Mathieu.Weill@afnic.fr>; accountability-cross-community@icann.org; Thomas Rickert <thomas@rickert.net> Betreff: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity I feel Greg captures and explains (much more eloquently) the issues I think we should be clarifying. Thanks! Jorge Von meinem iPhone gesendet Am 02.10.2015 um 16:52 schrieb Greg Shatan <gregshatanipc@gmail.com<mailto:gregshatanipc@gmail.com>>: I am quite confident that there are standards (objective or otherwise) for the definition and exercise of "fiduciary duty" by directors, both in the statutes and in case law, as well as in commentary (i.e., books and articles) and legal advice. Of course, the advice that the Board has received over the years in applying "fiduciary duty" as an ICANN Board member almost certainly takes a particular view of the legal standards and their application. Our counsel may well take a different view. We should get our counsel's view (and if possible, our counsel's view on ICANN's counsel's view). As a general matter, Boards are bound to to make all their decisions consistent with their fiduciary duties. This does not need to be set out in any document. It's a legal duty. Our issues don't focus on this overall exercise of fiduciary duty; rather, I think our primary concern is when the Board invokes fiduciary duty as a reason not to accept the recommendations, advice or decisions of the community or any part thereof. After that comes the question of whether and how to bind the ICANN Board to specific and explicit standards or interpretations for fiduciary duty, rather than relying on an unstated interpretation based on the advice of counsel. Then comes the questions of whether the Bylaws can include any specific requirements (e.g., extended rationale, supermajority) when the Board goes against the decisions of the Community and does so based on "fiduciary duty." After that comes the question of whether the Board's exercise of fiduciary duty can be challenged in RfR, IAP, MEM, etc. Finally, the question comes whether this challenge would be significantly different if brought by the Sole Member vs. any other entity. I don't believe "enforceability" hinges primarily on whether there are explicit standards for fiduciary duty set forth in the bylaws. As noted above, it is an inherent duty. If a Board violates its fiduciary duty, a party with standing (i.e., affected by the outcome) and the capacity to sue (i.e., legal personhood) can challenge that in court. However, explicit standards may make "enforceability" easier, since the complainant could point to specific bylaws that have been violated, rather than challenging the board's interpretation of fiduciary duty. Since there are a range of interpretations of fiduciary duty, and the Board has broad (but not boundless) discretion to interpret fiduciary duty, it becomes more difficult to challenge -- but not impossible, since some actions objectively violate fiduciary duty based on existing legal standards (e.g., if the Board exhausts its reserve fund to pay for trip to Las Vegas, any claim that this is consistent with their fiduciary duty is likely to fail). I hope this helps inform the questions we need to ask counsel in this situation. There is also a second question arising from Jorge's email, which is: What are the duties and obligations that must be considered when the membership makes a decision. Are the decisions of membership (in a California public benefit corp.) utterly arbitrary and without regard to any standard, or are they limited by some legal standards or duties? If so, what are those standards and duties? If there is no legal standard for member's decisions, how can these decision-making powers be constrained, e.g., in the Articles/Bylaws of the corporation, and what standards and mechanisms would typically be used to do so? This should be explored as well. Greg [https://ssl.gstatic.com/ui/v1/icons/mail/images/cleardot.gif] On Fri, Oct 2, 2015 at 10:25 AM, Mathieu Weill <mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr>> wrote: Hi Jorge, Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ? This is certainly an aspect we need to clarify . Best Mathieu Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Hi Mathieu, After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I'm presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing. I've tried to specify the question a bit more, and it would look as follows: Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: * concretizing these fiduciary duties in the Bylaws; * subjecting their correct interpretation to arbitration; * imposing special requirements on the rationale needed to be provided if they are used to override community decisions; * imposing extra-supermajorities in the Board in order to being able to invoke such duties? The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure. Please let me know if you can proceed with this. Regards Jorge Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch><mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org<mailto:accountability-cross-community@icann.org> Cc: leonfelipe@sanchez.mx<mailto:leonfelipe@sanchez.mx>; thomas@rickert.net<mailto:thomas@rickert.net> Betreff: Re: question on fiduciary duties and their objectivity Dear Jorge, You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $ Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was : o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board. Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority. If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ? Best Mathieu Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch<mailto:Jorge.Cancio@bakom.admin.ch> a écrit : Dear all, During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law. This is whether there are any means to subject the exercise of "fiduciary duties" (by the Board) to objective standards. As I have understood the discussion so far, the membership model allows the member to override "fiduciary duties" of the Board. However the member itself has no fiduciary duties vis-à-vis the organization. On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization. The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of "fiduciary duties" as it would provide the Board with an "arbitrary" power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards. Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions...) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?) Hope this helps, Regards Jorge -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** -- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06<tel:%2B33%201%2039%2030%2083%2006> mathieu.weill@afnic.fr<mailto:mathieu.weill@afnic.fr> Twitter : @mathieuweill ***************************** _______________________________________________ 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
Dear Jorge, We are planning an initial discussion during our next ccwg call, in order to ensure clarity on the request, and we will certify during the meeting. Best, Mathieu Weill --------------- Depuis mon mobile, désolé pour le style
Le 5 oct. 2015 à 08:14, <Jorge.Cancio@bakom.admin.ch> <Jorge.Cancio@bakom.admin.ch> a écrit :
Dear Co-Chairs,
May you please kindly confirm that this question will be certified to our lawyers?
Thanks and best regards
Jorge
Von: Cancio Jorge BAKOM Gesendet: Freitag, 2. Oktober 2015 17:02 An: Greg Shatan <gregshatanipc@gmail.com> Cc: Mathieu Weill <Mathieu.Weill@afnic.fr>; accountability-cross-community@icann.org; Thomas Rickert <thomas@rickert.net> Betreff: Re: [CCWG-ACCT] question on fiduciary duties and their objectivity
I feel Greg captures and explains (much more eloquently) the issues I think we should be clarifying.
Thanks!
Jorge
Von meinem iPhone gesendet
Am 02.10.2015 um 16:52 schrieb Greg Shatan <gregshatanipc@gmail.com>:
I am quite confident that there are standards (objective or otherwise) for the definition and exercise of "fiduciary duty" by directors, both in the statutes and in case law, as well as in commentary (i.e., books and articles) and legal advice. Of course, the advice that the Board has received over the years in applying "fiduciary duty" as an ICANN Board member almost certainly takes a particular view of the legal standards and their application. Our counsel may well take a different view. We should get our counsel's view (and if possible, our counsel's view on ICANN's counsel's view).
As a general matter, Boards are bound to to make all their decisions consistent with their fiduciary duties. This does not need to be set out in any document. It's a legal duty. Our issues don't focus on this overall exercise of fiduciary duty; rather, I think our primary concern is when the Board invokes fiduciary duty as a reason not to accept the recommendations, advice or decisions of the community or any part thereof.
After that comes the question of whether and how to bind the ICANN Board to specific and explicit standards or interpretations for fiduciary duty, rather than relying on an unstated interpretation based on the advice of counsel.
Then comes the questions of whether the Bylaws can include any specific requirements (e.g., extended rationale, supermajority) when the Board goes against the decisions of the Community and does so based on "fiduciary duty."
After that comes the question of whether the Board's exercise of fiduciary duty can be challenged in RfR, IAP, MEM, etc.
Finally, the question comes whether this challenge would be significantly different if brought by the Sole Member vs. any other entity.
I don't believe "enforceability" hinges primarily on whether there are explicit standards for fiduciary duty set forth in the bylaws. As noted above, it is an inherent duty. If a Board violates its fiduciary duty, a party with standing (i.e., affected by the outcome) and the capacity to sue (i.e., legal personhood) can challenge that in court. However, explicit standards may make "enforceability" easier, since the complainant could point to specific bylaws that have been violated, rather than challenging the board's interpretation of fiduciary duty. Since there are a range of interpretations of fiduciary duty, and the Board has broad (but not boundless) discretion to interpret fiduciary duty, it becomes more difficult to challenge -- but not impossible, since some actions objectively violate fiduciary duty based on existing legal standards (e.g., if the Board exhausts its reserve fund to pay for trip to Las Vegas, any claim that this is consistent with their fiduciary duty is likely to fail).
I hope this helps inform the questions we need to ask counsel in this situation.
There is also a second question arising from Jorge's email, which is: What are the duties and obligations that must be considered when the membership makes a decision. Are the decisions of membership (in a California public benefit corp.) utterly arbitrary and without regard to any standard, or are they limited by some legal standards or duties? If so, what are those standards and duties? If there is no legal standard for member's decisions, how can these decision-making powers be constrained, e.g., in the Articles/Bylaws of the corporation, and what standards and mechanisms would typically be used to do so? This should be explored as well.
Greg
On Fri, Oct 2, 2015 at 10:25 AM, Mathieu Weill <mathieu.weill@afnic.fr> wrote: Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question I’m presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
I’ve tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law: · concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
Von: Mathieu Weill [mailto:mathieu.weill@afnic.fr] Gesendet: Freitag, 2. Oktober 2015 11:06 An: Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org Cc: leonfelipe@sanchez.mx; thomas@rickert.net Betreff: Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch a écrit : Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of “fiduciary duties” (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override “fiduciary duties” of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of “fiduciary duties” as it would provide the Board with an “arbitrary” power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions…) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
-- ***************************** Mathieu WEILL AFNIC - directeur général Tél: +33 1 39 30 83 06 mathieu.weill@afnic.fr Twitter : @mathieuweill *****************************
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The group, unfortunately, as ever is diving thick into dealing with the details and legalese when the real issue and contestation is a larger political one. First of all, and this I accept is bit of a de tour, though for me a preface to the main point: a global governance body like the ICANN should be a public body under public law and not a private body. That is the main anomaly here, whose implications have been evident throughout the process, but which key issue we have simply bypassed. As a 'global' governance body it should of course be incorporated in international law, which most developing countries have demanded, but that has been given no consideration. In any case, as the second best option, pending a shift to the appropriate international jurisdiction, in fact, I have begun to think that, I may prefer it to be incorporated under an appropriate US statute with sufficient safeguards, and means of global representation in constituting ICANN and holding it accountable. Those who think this will put it 'back' under US oversight should understand that right now the same US legislature can at any time make any kind of law establishing any kind of authority over ICANN and its work, in its US non profit status. In fact, a well done statute could include better safeguards and clearer processes to make such interference more rather than less difficult. In any case, things no way become worse vis a vis the authority of the state of the US on ICANN if such a statutory incorporation route is employed - while it affirms the basic important political point that 'governance is a public function', and not a matter of private contracts, which the ICANN model is all about, and which for me its biggest negative contribution to our political thinking and landscape as we go forward. It then gets pushed into larger governance of Internet relates issues, and then to governance overall, of all issues and areas (in fact the latter strategic plan is mentioned in as many words in a World Economic Forum document). This is the route to a neoliberal privatisation of governance and political systems that this exercise is centrally contributing to which is my greatest problem with it. Coming back to the current point, now even if for whatever reasons we are decided on a private body status for ICANN, if non profit, the key and the prior issue we face is to choose between two forms, a Board-based private body or a membership-based one. Obviously, it is the latter which is relatively 'more public' than the former, which is clearly 'more private'. So, the choice should obviously be of a 'membership based body'. But then we see fears being expressed that members can go rouge (as if board members cannot, which would be so much more calamitous) or that members can wrongly capture power... The way forward then should be to improve the membership structure of ICANN, in one go or progressively, rather than succumb to the 'fear of the public' which most entities or people exercising unaccountable political power normally do. This is what I see happening here as well. (Yes, 'public' can be sometimes messy!) What I would see to be the proper course at this stage is to first - clearly and firmly - decide whether a Board mode is better or a Membership model, and if the latter, which I really see is preponderantly the view, go for it, and thrash out what kind of membership model best serve the needs of the context. It is no one's case that a membership model is impossible here, or the costs and/ or dangers of it are so expressly huge to be able to largely negate the logic of the higher political choice I spoke about earlier ('political' as in systems and institutions concerned with location, flow and distribution of power). Rather than taking this obvious and straightforward route, one is seeing various kinds of matters of detail, legalese and, sorry but, even trivia being thrown around, on the basis of which then some 'decision' , or is it 'consensus', will be arrived at, which by default decides the larger and higher political question - without ever actually addressing it. This, as I have critiqued before, has always been the primary and in my view the fatal flaw with the process, which no amount of legal advice, and discussions about the finer points of corporate governance, is ever going to cover up. And then of course there are no prizes for guessing what would be the nature of the final decision or model -- it will firmly lie within the rather narrow confines of what has rather bluntly been stated to be acceptable by the Board, and also the US government, which keeps making all the soft but powerful noises about giving them a model with least amount of change or possible confusion. It is made no better if some people who have been entrusted with, what is that rather fashionable word here, is it a, 'fiduciary duty' by the global Internet community to come up with an ICANN oversight model that best upholds global public interest, openly admit that there is no point in coming up with a model that is not to the taste of the ICANN and the US gov and therefore they would/ may not do so. Dont they know that whatever they present will be called as a community consensus model arrived at through a long transparent and participatory process, inclusive of the global community. Behold, democracy has triumphed!! History is written by the powerful. There will be no footnote anywhere that the model was presented because it was all that ICANN and the US was ready to accept. (Btw, a question, is CCWG meaning to append such a footnote to its final proposal, just for the sake of transparency and full disclosure?). No personal affront to anyone intended, but this process in my view has at this point sunk too low to be worthy of participation. But then I work with people whose interests are affected by what gets done here, and that gives me the justification to state my dissatisfaction and disappointment. And this process is being carried out in the name of all these people. parminder On Monday 05 October 2015 11:44 AM, Jorge.Cancio@bakom.admin.ch wrote:
Dear Co-Chairs,
May you please kindly confirm that this question will be certified to our lawyers?
Thanks and best regards
Jorge
*Von:*Cancio Jorge BAKOM *Gesendet:* Freitag, 2. Oktober 2015 17:02 *An:* Greg Shatan <gregshatanipc@gmail.com> *Cc:* Mathieu Weill <Mathieu.Weill@afnic.fr>; accountability-cross-community@icann.org; Thomas Rickert <thomas@rickert.net> *Betreff:* Re: [CCWG-ACCT] question on fiduciary duties and their objectivity
I feel Greg captures and explains (much more eloquently) the issues I think we should be clarifying.
Thanks!
Jorge
Von meinem iPhone gesendet
Am 02.10.2015 um 16:52 schrieb Greg Shatan <gregshatanipc@gmail.com <mailto:gregshatanipc@gmail.com>>:
I am quite confident that there are standards (objective or otherwise) for the definition and exercise of "fiduciary duty" by directors, both in the statutes and in case law, as well as in commentary (i.e., books and articles) and legal advice. Of course, the advice that the Board has received over the years in applying "fiduciary duty" as an ICANN Board member almost certainly takes a particular view of the legal standards and their application. Our counsel may well take a different view. We should get our counsel's view (and if possible, our counsel's view on ICANN's counsel's view).
As a general matter, Boards are bound to to make all their decisions consistent with their fiduciary duties. This does not need to be set out in any document. It's a legal duty. Our issues don't focus on this overall exercise of fiduciary duty; rather, I think our primary concern is when the Board invokes fiduciary duty as a reason not to accept the recommendations, advice or decisions of the community or any part thereof.
After that comes the question of whether and how to bind the ICANN Board to specific and explicit standards or interpretations for fiduciary duty, rather than relying on an unstated interpretation based on the advice of counsel.
Then comes the questions of whether the Bylaws can include any specific requirements (e.g., extended rationale, supermajority) when the Board goes against the decisions of the Community and does so based on "fiduciary duty."
After that comes the question of whether the Board's exercise of fiduciary duty can be challenged in RfR, IAP, MEM, etc.
Finally, the question comes whether this challenge would be significantly different if brought by the Sole Member vs. any other entity.
I don't believe "enforceability" hinges primarily on whether there are explicit standards for fiduciary duty set forth in the bylaws. As noted above, it is an inherent duty. If a Board violates its fiduciary duty, a party with standing (i.e., affected by the outcome) and the capacity to sue (i.e., legal personhood) can challenge that in court. However, explicit standards may make "enforceability" easier, since the complainant could point to specific bylaws that have been violated, rather than challenging the board's interpretation of fiduciary duty. Since there are a range of interpretations of fiduciary duty, and the Board has broad (but not boundless) discretion to interpret fiduciary duty, it becomes more difficult to challenge -- but not impossible, since some actions objectively violate fiduciary duty based on existing legal standards (e.g., if the Board exhausts its reserve fund to pay for trip to Las Vegas, any claim that this is consistent with their fiduciary duty is likely to fail).
I hope this helps inform the questions we need to ask counsel in this situation.
There is also a second question arising from Jorge's email, which is: What are the duties and obligations that must be considered when the _membership_ makes a decision. Are the decisions of membership (in a California public benefit corp.) utterly arbitrary and without regard to any standard, or are they limited by some legal standards or duties? If so, what are those standards and duties? If there is no legal standard for member's decisions, how can these decision-making powers be constrained, e.g., in the Articles/Bylaws of the corporation, and what standards and mechanisms would typically be used to do so? This should be explored as well.
Greg
On Fri, Oct 2, 2015 at 10:25 AM, Mathieu Weill <mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr>> wrote:
Hi Jorge,
Thanks for providing these additional thoughts and refinements. The way I read these is that you are not only looking for clarity of what fiduciary duties imply, but also on potentialoptions to make them enforceable (by specifying them in the Bylaws, etc.) ?
This is certainly an aspect we need to clarify .
Best Mathieu
Le 02/10/2015 11:43, Jorge.Cancio@bakom.admin.ch <mailto:Jorge.Cancio@bakom.admin.ch> a écrit :
Hi Mathieu,
After reviewing the legal memo you just sent and what it says about fiduciary duties, I feel that the question Im presenting is not tackled in that Memo and that we still would largely benefit right now from a better understanding of the question I was proposing.
Ive tried to specify the question a bit more, and it would look as follows:
Is there any means under Californian Law that would allow to subject the exercise of fiduciary duties to objective and controllable standards? For example, could the following or similar means be acceptable and usable under Californian law:
· concretizing these fiduciary duties in the Bylaws;
· subjecting their correct interpretation to arbitration;
· imposing special requirements on the rationale needed to be provided if they are used to override community decisions;
· imposing extra-supermajorities in the Board in order to being able to invoke such duties?
The underlying idea is IMHO very relevant to our present discussions on the Model, especially for those of us who are not experts in Californian Corporate Law: i.e. is there a legal means to subject those fiduciary duties to specific and objective standards and/or third-party control? If there are, could we use those means (if they exist) to develop our model? If they do not exist, or are too limited, this might speak for a membership structure.
Please let me know if you can proceed with this.
Regards
Jorge
*Von:*Mathieu Weill [mailto:mathieu.weill@afnic.fr] *Gesendet:* Freitag, 2. Oktober 2015 11:06 *An:* Cancio Jorge BAKOM <Jorge.Cancio@bakom.admin.ch> <mailto:Jorge.Cancio@bakom.admin.ch>; accountability-cross-community@icann.org <mailto:accountability-cross-community@icann.org> *Cc:* leonfelipe@sanchez.mx <mailto:leonfelipe@sanchez.mx>; thomas@rickert.net <mailto:thomas@rickert.net> *Betreff:* Re: question on fiduciary duties and their objectivity
Dear Jorge,
You are rightly pointing out one of the key areas where a shared understanding of the concept and consequences has not been achieved so far. $
Our 2nd report highlighted this issue for further investigation during WS2, but I note that some comments mentioned that this should not be clarified as part of WS1. The exact wording of our work item was :
o Clarifying understanding of the fiduciary duties of Board Directors and related expectations concerning Director behavior for the Board.
Past work on the topic include several mentions in legal memos. Most notable is on page 4 of one of the initial memos from our Counsel dated 12 april (https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20...) which addresses the balance between accountability and decision making authority.
If we were to pursue this at this stage, we probably should flesh out some questions to direct work from our Counsel. What would be the type of questions you would raise Jorge ? (or others) ?
Best Mathieu
Le 01/10/2015 10:41, Jorge.Cancio@bakom.admin.ch <mailto:Jorge.Cancio@bakom.admin.ch> a écrit :
Dear all,
During the debates we had on the last conference call I put forward a question which I feel could be important to better understand under Californian corporate law.
This is whether there are any means to subject the exercise of fiduciary duties (by the Board) to objective standards.
As I have understood the discussion so far, the membership model allows the member to override fiduciary duties of the Board. However the member itself has no fiduciary duties vis-à-vis the organization.
On the other hand, fiduciary duties are apparently a useful tool within corporate law, as it imposes a duty to care for the welfare of the whole of the organization.
The argument which is made by some, as far as I understand it, is that there is however a problem in the exercise of fiduciary duties as it would provide the Board with an arbitrary power, e.g. to override community decisions (in exercise of community powers) without being bound to any objective standards.
Considering all this, my question (to the Lawyers, if this is certified as a question to them) would be: is there any means under Californian Law (or other US jurisdictions ) that would allow to subject the exercise of fiduciary duties to objective standards? (e.g. be it through concretizing these duties in the Bylaws, subjecting them to arbitration, imposing special requirements on the rationale needed to be provided if they are used to override community decisions, or, for instance, imposing extra-supermajorities in the Board in order to being able to invoke such duties?)
Hope this helps,
Regards
Jorge
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06 <tel:%2B33%201%2039%2030%2083%2006>
mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr>
Twitter : @mathieuweill
*****************************
--
*****************************
Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06 <tel:%2B33%201%2039%2030%2083%2006>
mathieu.weill@afnic.fr <mailto:mathieu.weill@afnic.fr>
Twitter : @mathieuweill
*****************************
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participants (13)
-
Arun Sukumar -
Avri Doria -
Bruce Tonkin -
Greg Shatan -
James Gannon -
Jorge.Cancio＠bakom.admin.ch -
Kavouss Arasteh -
Mathieu Weill -
parminder -
Roelof Meijer -
Rubens Kuhl -
Seun Ojedeji -
Thomas Rickert