Thanks Greg, for your detailed responses . My comments are below, and I dont think I would have much to say on these items after that.

On Tuesday 18 October 2016 12:26 AM, Greg Shatan wrote:

Some follow-up on the hypotheticals below, removing my rapporteur hat for the purpose, but still trying to use objective legal analysis, rather than seeking any particular result.

Greg

On Sun, Oct 16, 2016 at 1:54 AM, parminder <parminder@itforchange.net> wrote:

Milton,

Thanks for your engagement with these issues . Some responses below.

On Tuesday 11 October 2016 10:21 PM, Mueller, Milton L wrote:

1. What happens if the concerned US court holds .xxx to be against US's competition law? Describe the steps that will follow, and how can ICANN avoid bending its policy making process and authority to the will of the US state.

MM: I don’t think that’s a problem for ICANN. It’s a problem for the entity that was delegated .XXX. Since XXX holds a tiny sliver of the domain name market, even in the porn space, this is a very remote risk.

Is there not problem even if .xxx was not a US company owned, which has no reason to like/ accept being governed by US laws? Milton, when we frame regimes for rule of law, and of justice, we do not say, well that is small fry, a small 'sliver of the market', rules and justice has to be the same for all - small or big. It is a question of principle -- can US law force ICANN polices, or their operationalisation ? If they can, as you seem to agree here, it is problem that we must find a solution to.

Annex 12 says "At this point in the CCWG-Accountability’s work, the main issues that need to be investigated within Work Stream 2 relate to the influence that ICANN ́s existing jurisdiction may have on the actual operation of policies and accountability mechanisms." (emphasis added)

This is directly an issue where ICANN's existing jurisdiction has influence on actual operation of its policies -- in this case its policies under which .xxx was delegated.

GS: If .xxx was not a US company, but it does business in the US, it subjects itself to US laws; that has nothing to do with ICANN.

What it has to do with ICANN is the question about a court deciding whether ICANN should or should not have delegated .xxx . A judgement that could adversely impact ICANN in making and implementing its policies (an express mandate of this group). This court case is not just about how .xxx works, it is as much about the action of delegation of .xxx by ICANN - . An action that can be nullified by the court, which will make a travesty of ICANN's role as a global governance body, which cannot be subject to one country's law. Remember that causes of action in the case are also against ICANN, and any action arising from the court case that makes ICANN reverse an act of operationalsing its DNS policies is direct interference in its work. It also directly related to the mandate of this group which is to look into jurisdictional issues that could have impact on actual operation of ICANN's policies'. To repeat, I am not at all bothered about how the court could possibly force .xxx to act in any particular way, I am only bothered by how it can force ICANN to act, and that only a US court can do bec ICANN is in the US.

Some things are unclear from your hypothetical:

1. Is the US government the plaintiff alleging effects in US commerce, or is the plaintiff a private party that alleges that it has been harmed by .xxx's anticompetitive acts?

it is private parties, but one that has brought a case not only against .xxx but also against ICANN. You need to focus on this latter fact. Forget about the .xx owner.

2. What actions by .xxx have allegedly violated competition laws? Have they engaged in price fixing or bid rigging or predatory pricing or price discrimination?

We need not go into looking into the merits of the case here. What is salient is that ICANN has been sued on three counts -- "a Section 1 claim for conspiracy in restraint of trade; a Section 2 claim for conspiracy to monopolize; and a Section 2 claim for conspiracy to attempt to monopolize". The court will decide if these allegations against ICANN hold, and accordingly can make it act in ways different than it has in this case. This is a direct interference in a global governance role of ICANN (again, lets forget about .xxx registry owner)

3. If this was unilateral activity, what is the product market in which .xxx has monopoly power or sufficient market power for this to be an antitrust violation? (As Milton points out, the answer is likely to be "none," as individual TLDs are extremely unlikely to be considered "markets" and .xxx would have only a small sliver of the total SLD market, and thus would not be capable of violating the antitrust laws. That is why Milton mentioned that .xxx was "small fry." Indeed antitrust laws are not applied equally to companies with small market shares and large market shares, nor should they be; companies with small market shares have no market power, and thus can do things like price below cost, that companies with high market shares and market power cannot do (e.g., a company with market power pricing below cost for a sustained period of time in order to drive smaller competitors from the market is engaged in "predatory pricing," a company with a small market share pricing below cost for a sustained period of time is committing business suicide or sacrificing profit for market share, but they are not violating the antitrust laws.)

Again, you are arguing about the merit of the case, which I have no desire to. The court has taken the case on file and dismissed ICANN's appeal to dismiss the case, and has asserted that US anti-trust laws apply on ICANN generally, and specifically in this matter. That is enough for me. If you and Milton think that the case is not made out, you should argue before the court. The court will test ICANN's delegation policies with regards US laws and let it know what it can do or not do... If this is not juridical interference on ICANN's policy role, I cannot understand what would be.

4. If this was collusive activity, with whom were they colluding, and in what market, and are they co-defendants (and if not, why not)?

Again, these are matters to be argued before the court. You can hardly expect me to begin arguing the plaintiff's case here. Just note that the court has ruled on prima facie admissibility of the collusion etc allegations, which simply means the decision could go either way. If in this particular case, with the burden of the facts being so and so, it actually goes ICANN's way, in another similar case it could go against. That 'fact' alone is important for the present discussion.

5. Are you assuming that the only way .xxx was brought into US court is because ICANN "issued" the gTLD, and that every other test for in personam jurisdiction failed?

No, I have no problems where .xxx registry owners are taken; i have a problem solely with ICANN's act of global governance being brought to a US court, and a prima facie case made out. This itself makes the case for doing everything to immunise ICANN from US law, or any other single county law, in matters that are about its global governance function.

Since the "minimum contacts" for in personam jurisdiction are quite low (transacting business within the state; committing a violation of law in the state, committing a violation of law outside the state that causes injury within the state, or having or using real property within the state.), it is extremely unlikely that .xxx would fail them. If it did fail these test, it's essentially impossible for their to be a competition law violation, since the minimum contacts test is aligned with the type of activity that would be required to show that an antitrust violation occurred. So, if a plaintiff attempted to hail .xxx into court in the US, but there was no activity that could serve as the basis of jurisdiction or a claim, the case would be tossed, and it's reasonably likely the plaintiff and their lawyers would be sanctioned.

On the other , if .xxx has violated US antitrust laws (which would require both business activity and harm in the US), why shouldn't they be subject to suit (by the government or a private party) in the US? .xxx is just a Registry business; it's not entitled to any particular immunities.

Let them be subject to US or whatever law, my problem, and I repeat, is entirely and exclusively about ICANN being subject to US law... I think there is a clear difference, which is what we need to focus on.

In the end, I see no connection between this hypothetical and ICANN's policies or ICANN's jurisdiction of incorporation or HQ location.

Greg, You have suddenly jumped form a discussion that only discussed .xxx registry owner, and not ICANN, to an implication about ICANN... Working backwards, to get to such an implication, you should have been focussing on the fact that ICANN is hauled in the court, and prima facie case for possible cause of action against ICANN made out.

2. Same about .africa.

Same response.

Same response from me as well - other than that here, unlike for .xxx, those who claim the gTLD, and thus will be affected by an adverse decision of the US court, are parties not belonging to the US and thus should not be dictated to by US courts.

GS: In the .africa case, DCA sued ICANN and ZACR in the US. They could have chosen to try and sue elsewhere, since there are other places where ICANN can be sued, but they chose the US.

This is not at all true. ICANN cannot be profitably sued anywhere other than in US... Effective and meaningful court case should have levers of implementation of possible decision at hand, which are only available only in the US with regard to ICANN. (I distinctly remember ICANN being called to a court in another country and it going there and saying, sir, we are not subject to your jurisdiction, but I cannot recollect exactly where.)

DCA is seeking adjudication by a court, and they chose the US courts, so this is not in any way a situation in which DCA does not want to be "dictated to by US courts."

There is no other country's court it could have gone to for usefully challenging an action of an US non profit, that ICANN is.

As for ZACR, they could have sought to be removed from the case due to lack of minimum contacts with the US, and they may well have succeeded -- but then they would be on the sidelines in a case where their ability to run .africa was at stake,

Which was at stake only because a US court can actually force ICANN's hand, unlike that of any other country. They would not have cared to even get an lawyer if the same case had been brought up in Vietnam.

and that wouldn't be a very good choice. It's an essential factor of being a defendant that you don't get to choose the court in which you're sued, at least not initially

ICANN does, it has said in other countries' courts, sorry, but I am not taking it, I am not subject to your jurisdiction, and the courts could do nothing...

-- you can try to get out of the case, or have the case dismissed for jurisdictional reasons, or have the case removed to a different court with a greater interest in the case, after you are sued.

Again, I see no connection between this hypothetical (or actual case) and ICANN's policies or ICANN's jurisdiction of incorporation or HQ location.

3. With 100s of new gTLDs getting operational, many of them private closed ones with generic names (but that is hardly the only issue, there could be many others), is it not obvious that we will be seeing many court cases around them... What would ICANN do the moment an adverse judgement comes?

See above. Not an issue for ICANN. Most of these court cases are between private parties, but even regulations or antitrust actions would be directed against the holder of the gTLD, not ICANN. Only if ICANN itself were accused of fostering a monopoly would it be the target of such litigation.

Again, you seem to be fully unaffected by how global parties - companies, and people - who expect ICANN to be a global governance body and thus do thing just-fully, and they able to partake equally of the rights and benefits of a global domain name governance systems are unable to fulfil this legitimate, and democratic, expectation. If this means nothing to you, and only such actions that directly affect ICANN's organisation etc are meaningful, I have not much more to say here... My principal case is of how ICANN's current jurisdiction affects the global DNS, its governance, its legitimacy, justfullness, etc -- and not just now it affects ICANN's organisation.

Perhaps lets separate these two issues then, treat them separately. (1), impact of ICANN jurisdiction on ICANN's organisation, (2) its impact on ICANN governance and operation of global DNS, including allocation of gTLDs/ ccTLDs, and managing the relationship with them.

For the me (2) is by far more important, but if (1) is your focus, we can consider them both, separately.

GS: First, it's not obvious that we will be seeing many court cases around new gTLD registries. Second, if there are court cases, I assume that the plaintiffs will bring them in a jurisdiction where the registry can be "found", like any other business.

That would be legitimate and fine. We are talking about what would not be legitimate. And that is a US plaintiff taking the advantage of the company that actually delegated the gTLD being in the US - that is ICANN - to get a ruling employing US law -- which has been developed and works for US public interest (and mostly, rightly so).

I doubt they will be sued in the US solely on the basis that the company that granted them the right to operate the gTLD is located here; and if suit is brought here, it's not at all likely that this basis for jurisdiction will succeed

Like the court is doing in the .xxx case, a US court will still take on the examination of the actions of ICANN in issuing the gTLD, and be ready to give its decision on it which can force ICANN to act as per the decision.

(look at how the .ir situation has resolved, and consider that .ir was involved as a TLD asset, not as a registry business). If there's an adverse judgment, ICANN typically wouldn't be involved

As said above, there are three possible causes of action against ICANN in the .xxx case, and therefore ICANN is directly involved, and will be made to act as the court decides.

-- unless the judgment called for a transfer of the gTLD, and that would only occur in very limited circumstances.

Or annulment of the gTLD ... I am not sure why you say it could only be in limited circumstances. And even a few times are enough, for it to be unacceptable incursion of US jurisdiction on ICANN's global governance function. Further, law is made to be observed and not violated - its power and very existence is not counted just by instances of its violation. Its very existence, of US jursidiciton over it, will make ICANN - it already does - act in certain ways and not others, which is problematic enough for me.

If that were the case, it wouldn't matter where the case was brought -- the winning party would request that ICANN honor the court's ruling that the plaintiff and not the defendant was entitled to the gTLD. ICANN could agree, or it could contest the award.

ICANN will simply say to the court in India or Nigeria, please mind your own business, that is if it even bothers to respond. i see no possibility of ICANN accepting a ruling of any other country's court than of the US on matters of its policy implementation .

If the case was brought in France, ICANN could contest it in the French court. Alternatively, the plaintiff could seek to enforce the judgment by suing ICANN in the US (but this would happen in any jurisdiction where ICANN could be sued -- nothing unique to the US). Again, I see no issue. There was a private dispute between two parties, brought somewhere in the world. This has nothing to do with ICANN's current place of incorporation or HQ.

I am not talking of private disputes, but those which invoke public law, like anti-trust law, consumer protection, privacy related, and so on...

4. What if OFAC doesn’t give licence to ICANN for dealing with a particular country due to great deterioration of relationships with the US.

Now, you have hit on a real issue. I believe however that NTIA has taken some precautions here, but I don’t recall what they are.

NTIA's 'precautions' - even more so, the unrecollected ones :) - are meaningless for non US people/ businesses who really are looking to get out of NTIA's 'protection' - isnt that all this oversight transition is supposed to be about ?

GS: I assume you are referring to "great deterioration of relationships" between ICANN and the US, since "great deterioration of relationships" between a country and

the US is the reason one needs an OFAC license in the first place.

I think there is a confusion here. ICANN has to take an OFAC license to do business with a country that is on US's 'deteriorated relationships' list -- it has nothing to do with the nature of relationships between US and ICANN.

First, this is truly hypothetical -- OFAC licenses are granted based on their merits, not on relationships. Second, without examining the precautions Milton mentions, it's premature to dismiss them.

As far as i remember, Milton never mentioned any precautions. I could equally say to you, without even having heard what the precautions are, it may be premature to accept them to have fully made the case :)

Third, if the US government did in fact withhold an OFAC license from ICANN out of spite, it would severely damage the US's ability to serve as an appropriate home for ICANN, and could lead to legitimate calls for an examination of ICANN's location; this serves as a very significant deterrent against any such behavior.

As said, this is not about US relationships with ICANN. Secondly, we have heard enough of this logic - US will not abuse its positions because it will reduce its stature in the eyes of the global public and this would stretch its legitimacy to carry on in this exalted position. This logic is so weak that I do not want to even respond to it. (Could we not say a similar thing say about ICANN's board, or practically every position of authority in the world, whereby no measures against possible abuses will ever be required?)

As to what the oversight transition was supposed to be about: The purpose of the IANA transition was not to make ICANN no longer subject to the rule of law under US law.
It was about removing the unique relationship between the US and ICANN embodied in the IANA contract, and allowing the global multistakeholder community to oversee ICANN's activities, rather than the US government.

I just said that for a process aimed at ridding ICANN of NTIA oversight, continue to be relying on some un-recollected NTIA precautions would be strange.

Indeed, the "enforceability" aspects of the Empowered Community's actions depend on ICANN being subject to the jurisdiction of courts, and count on the availability of US courts to enforce any action by the Empowered Community where ICANN refused to comply.
If ICANN no longer had any contacts with the US, then ICANN would still need to be subject to being sued in court somewhere for the accountability mechanisms to work fully.

It is possible to work out possibilities in international law - that is once we begin exploring it. There are other ways as well to achieve it, while ensuring that US public laws cannot interfere with ICANN's policy making or implementation processes. For it, we need to first focus on the latter being our key imperative.

I understand that there are some who would like to remove ICANN from the United States. If, now or in the future, ICANN cannot carry out its policies or the accountability mechanisms do not work because of ICANN's location, and the only remedy is moving ICANN so that it can function, then there are methods to seek such a change inherent in iCANN's governance structure (i.e., methods for changing the Articles, where ICANN's jurisdiction of incorporation is set forth, and the Bylaws, where ICANN's HQ location is set forth). If this subgroup determines that there is an issue where ICANN is currently unable to carry out policies or the accountability mechanisms are impeded, we will look at all potential remedies (and all of the consequences of such potential remedies).

All the cases I had put forward concern situations where very likely, in case of very possible adverse court judgement for instance, ICANN will be unable to carry out its policies, in the manner that they have been developed in a global manner, and which therefore should only be answerable to a suitably global mechanism. I think that these cases require us to look into possible remedies, with regard to the problems with US jurisdiction over ICANN.

5. What if the FCC revises its decision of forbearance about its authority over Internet addressing system (as it did on the issue of whether Internet was title one or title two)?

MM: This would require legislation, because nothing in the existing Communications Act gives the FCC any authority over DNS or IP addressing. So this is just another example of “what if the US legislates to regulate ICANN in some way?” Which of course is a risk if ICANN were in ANY jurisdiction.

This is not true -- in the same way as, without any new legislation, FCC revised its stand on forbearance over seeing Internet as a telecom utility, and made it title 2. 'Forbearance' has this legal meaning of legal authority being there but not being exercised -- FCC's chair has clearly used the term 'forbear' in recent utterances about FCC's authority over Internet addresses. And in any case, what if as you say such a thing will require a legislation from the US legislature -- that is no comfort to non USians/

GS: I'm not going to wade into the complexities of FCC policy and scope. If the US or any country or group of countries (e.g., the EU) actually sought to usurp ICANN's role in DNS and IP addressing, that would be something to deal with and consider remedies at that time. As Milton notes, this is a risk regardless of ICANN's location (and a risk that is not necessarily tied to ICANN's physical location).

This is because you seem to have only two possibilities in mind, ICANN under US jurisdiction, or ICANN under some other country jurisdiction. That is not the remedy. Remedy is of ICANN being put under international jurisdiction, or ICANN with full jurisdictional immunity expressly provided by US, for which proper legal framework as well as precedents exist in the US. In these cases, the mentioned risks would not exist.

6. There are almost as many US agencies that can exercise mandate over ICANN's domain name policies as there are sectors that the Internet and thus its naming system impacts. (ICANN allowed some 'regulatory policies' to buyers of .pharmacy, and going forward as it also does this with many other sectoral domain names, all of these can be challenged, in the courts, as well as with sectoral regulatory bodies). What then?

MM: These dangers are greatly diminished post-transition.

I see now way how the danger of any US executive authority exercising mandate over ICANN have diminished post transition other than your word for it..... And then I do not want them diminished (even that they havent), I want them extinguished. Statutory US bodies need to and will do whatever they can to further their policies and law, and would order any US body accordingly - nothing has changed, one may just be imagining that it has.

GS: This is far too generalized to be considered as a scenario. What agencies do you think have a scope of authority over ICANN, and under what legislation? If it's DOJ/FTC under antitrust law, this is actually an accountability feature and not a bug.

Yes, similar. You may consider subjection to US law as an accountability feature, but I do not, and I expect all non USians to think so... Would you Greg be fine if your legal firm was subject to Indian corporate law, legal profession regulatory mechanisms, and such regimes? I would like an honest answer. I often ask this from people from the US but they never respond. If you take sincere 10 mins to really reflect, and try to respond to this, we may well have solved the jurisdiction issue :)

The intent is that the antitrust law be available in the event ICANN allegedly violates US antitrust laws. (The whole "antitrust immunity" discussion was completely misguided.)

Why should ICANN be able to be punished for violating US anti trust laws, but not India's or Ghana's??? Or other social justice laws of these countries? The injustice and unfairness of this is so patent that I am not sure why are we even discussing it. We perhaps really need to raise our democratic quotient.

As for .pharmacy (or other TLDs) having certain safeguards, that is entirely a policy and business decision by that TLD.

No, it is a decision of ICANN and that tld together -- ICANN approves or disapproves of such 'safeguards' in the gtld policies . ICANN can accordingly be ordered around by that particular sectoral regulator in the US, FDA in this case. It can also interfere through its jurisdiction over the group that owns .pharmacy, which happens to be US based. But if that group had been non US, FDA could still simply had got its way by ordering ICANN's actions. It is this what is not acceptable.

The new gTLD program was intended to foster different business models, so this should be considered a successful implementation. Technically, it could be "challenged" -- but under what cause of action? What law is being violated that could lead to either US government enforcement or a private party action? And what does ICANN's location have to do with the registry being capable of being sued in the US, since any business or harm in the US is sufficient to sue the registry in US courts, regardless of ICANN's location?

It can be challenged under so many provisions of US law and regulations, and by so many of its agencies, that I can not even begin to count them. See .pharmacy and FDA example above for instance... If you want more, I could provide them ... It could be about .hotels, or a possible .cars, and so on.....

If you even begin trying to deal with these questions, you will realise what a volcanic earth we are sitting upon, in refusing to see the public law jurisdiction issue.

MM: Don’t agree we are sitting on a volcano, but do agree there are issues that need to be anticipated, a kind of “stress test”

Yes, thanks, exactly that. We need to follow through each of these scenarios to possible logical conclusions - looking at all plausible ways they can go.

GS: First, I don't see the hypotheticals regarding suing third parties in US courts as really "stress tests" of ICANN's location, since there will almost inevitably be other bases for being able to sue that party in a US court,

As I said many times, I am not bothered about any 'that party' being sued or not, or of someone using ICANN to sue it or not - I am talking of cases where ICANN itself is sued and is the butt of probable cause of action.

given the similarity between the minimum contacts required for that purpose and minimum requirements to have a viable cause of action. As such, ICANN's location simply doesn't seem to be relevant to those scenarios.

Since I am focussed only on ICANN being sued, and forced to act in certain ways contrary to policy developed by a global mechanism, the only thing important to me is that ICANN can fruitfully only be sued in the US, and in no other jurisdiction. That is a plain and simple fact.

In those scenarios where the US government hypothetically seeks to interfere with ICANN policy or with ICANN's accountability mechanism, I think the overall "stress test" is whether ICANN could take steps at that time to oppose such actions or, failing that, seek to remove itself completely from US jurisdiction

Yes, here finally we have come to the only point that I am making.... Yes, that would be the stress test, and lets do it.... All the 5-6 scenarios that I posed, what you have called as 'hypotheticals' leads to possible situations where ICANN will have to, on orders of a court or other legitimate US authority, change its actions that otherwise arise from policies developed in a global fashion..... I dont see how ICANN can extricate itself in such situations - but if you or others have suggestions, Id be happy to hear them.

(and whether moving out of the US would have that intended effect)? I'm not aware of any reason that ICANN could not try to do so, but it would need the global multistakeholder community's agreement to do so. A related question is whether the Empowered Community, as the agent of the global multistakeholder community, could force ICANN to move out of the US against ICANN's will -- and whether there are safeguards against such an action so that it would only occur if there were a proper basis for such a drastic act? It's something we may need to look at, but based on the escalating powers of the Empowered Community (up to and including "spilling" the board, I think the community has the necessary power to move ICANN under such exigent circumstances.

But we should be able to agree that mature and responsible organisations normally are prepared for such possible (I say, very likely, but even if it were less than very likely) eventualities, and do not begun preparing once they come to pass. So let me suggest one some possible preparation, which can considerably address most of our jurisdictional problems without actually moving ICANN out of US.

ICANN can institute a fundamental bylaw that its global governance processes cannot be interfered with by US jurisdiction. If any such interference is encountered, parametres of which can be clearly pre-defined, a process of shifting of ICANN to another jurisdiction will automatically set in. A redundant set-up – with HQ, root file maintenance system, etc – will be kept ready as a redundancy in another jurisdiction for this purpose. Chances are that with the knowledge of this bylaw and a fully plausible exit option being kept ready, no US state agency, including its courts. will consider it fruitful to try and enforce their writ. This system could therefore act in perpetuity as a guarantee against jurisdictional interference without actually having ICANN to move out of the US.

How does it sound?

Thanks again for this really useful engagement. parminder

Greg
parminder

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