[CCWG-ACCT] [Acct-Legal] Fwd: Legal question

Tue Apr 21 07:19:43 UTC 2015

Dear Greg
Thank you indeed for your clarification.
Sorry If I misunderstood your views
You may provide any argument to support the membership Model
I am for any option which requires less changes to Bylaws,less complex to
inmplement, less time consuming to apply, not going toofar up to the
extreme limit.
However, I fully respect your valid reasons for Member Model
Regards
Kavouss

2015-04-21 8:59 GMT+02:00 Greg Shatan <gregshatanipc at gmail.com>:

> Kavouss,
>
> That is not a correct summary of my views.  Bylaws provisions are
> generally enforceable.  (As an aside, "enforceable" can be use to mean two
> different things: (1) is the provision valid, so that an enforcement effort
> will not fail, and (2) can the other party or parties undertake an effort
> to enforce the provision by commencing litigation.  I have tried to deal
> with both aspects of "enforceability," without veering too far into other
> ways of getting ones way (e.g., California AG, political pressure,
> Congressional investigation, pulling out and creating an alternate IANA,
> etc.)
>
> In spite of the general rule, there are two issues in this specific
> circumstance that undercut this general rule of enforceability.  First, a
> couple of the specific powers that Chris mentions are ones where a third
> party is given a right superior the Board to make a decision regarding the
> management of the company (veto of budget and arbitration to enforce the
> veto of budget).  In a member organization, the members can appropriately
> be in this superior position.  In a non-member organization, that is
> inconsistent with the role of the Board, which brings the validity of these
> bylaw changes as hypothesized by Chris into question.  Second, the SO/ACs,
> as entities currently without legal personhood, would likely not be able to
> participate in a litigation to enforce these bylaws; thus, the second type
> of enforceability is also an issue.
>
> It may be less troublesome for ICANN to enter into contracts and agree
> with third parties (i.e., the SO/ACs) that these third parties have the
> right to veto the budget. (Companies may be able to agree with third
> parties to do things that could not be part of their internal governance
> schema.) However, on further reflection, even this approach has its issues
> -- as the SO/ACs lack legal personhood currently, they cannot enter into
> contracts, either.  (By contrast, the bylaws changes can at least be put
> into place without any action on the SO/AC's part.)
>
> I should note that granting third parties the right to approve a bylaw
> change (the third hypothetical action in Chris's email) is not as
> exceptional, so is less likely to raise validity concerns.  This still
> leaves the issue that the SO/AC's lack the requisite legal existence to
> commence legal action to enforce a bylaws change in the event the Board
> fails to recognize such a bylaws change.
>
> In my opinion this kind of complexity and uncertainty is precisely why the
> member model should be adopted.
>
> Greg
>
> On Tue, Apr 21, 2015 at 2:25 AM, Kavouss Arasteh <
> kavouss.arasteh at gmail.com> wrote:
>
>> Dear All
>> We complicating the case by envisaging the most extreme exceptional
>> circumstances.
>> In view of Greg, a Contract provisions are enforceable compared to Bylaws
>> provisions which in his views are not enforceable!
>> We may put the questions and answers to the lawyers and wait whether are
>> consent?
>> Could someone take necessary action ( e. g.) co chair in this regard?
>> Tks
>> Kavousd
>>
>>
>> Sent from my iPhone
>>
>> On 21 Apr 2015, at 08:02, Greg Shatan <gregshatanipc at gmail.com> wrote:
>>
>> The questions are simple.  The answers may not be....
>>
>> Also, it depends on what the lawyers are currently working on.  Further,
>> the meeting is in about 13 hours, and I expect (given the time) at least
>> 6-8 of those hours will be used for sleep and commuting.  So, it's not a
>> lot of time.
>>
>> My views are as follows:
>>
>> On question 1, I think there may be issues in granting this right via
>> bylaw, except to statutory members (and possibly to designators, at least
>> where formally denoted as such), but these many not sufficient issues to
>> cause the bylaw to be invalid.  If it's found to be invalid in court, then
>> it would be unenforceable.  However, I believe that something similar could
>> be achieved by contract, which should then be enforceable.
>>
>> On question 2, I would say that the Board cannot ignore an action
>> mandated by the bylaws without some consequences.  The SOs and ACs as
>> currently constituted may not have the necessary legal personhood to pursue
>> litigation.  However, this could be reported to the California Attorney
>> General, who has broad oversight powers relating to non-profits, and would
>> probably be quite interested to hear about a relatively high-profile
>> non-profit where the Board was ignoring actions mandated by duly approved
>> bylaws.  This could certainly be considered "enforcement," broadly
>> speaking.  There may also be other parties with legal personhood that could
>> pursue litigation, and other governmental entities (Congress?) that could
>> make this an exceedingly difficult choice to sustain.
>>
>> On 3, if the bylaw says the Board is bound, they're bound, unless the
>> Board were to successfully challenge the validity of the bylaw.  Again, it
>> may be possible to achieve this by contract, with fewer questions raised.
>> And again, there may be issues in granting this right to parties other than
>> members (or possibly formally recognized designators), but those issues may
>> not invalidate the bylaw.
>>
>> On 4, I think the answers to question 2 apply here as well.
>>
>> We can see if counsel agrees with this....
>>
>> Greg
>> Caveat: not legal advice, not admitted in California
>>
>> On Tue, Apr 21, 2015 at 12:55 AM, Chris Disspain <ceo at auda.org.au> wrote:
>>
>>> Hi León,
>>>
>>> Really? They are fairly simple questions. As I said, I can ask them on
>>> the call.
>>>
>>>
>>>
>>>
>>> Cheers,
>>>
>>>
>>> Chris
>>>
>>> On 21 Apr 2015, at 14:32 , León Felipe Sánchez Ambía <
>>> leonfelipe at sanchez.mx> wrote:
>>>
>>> Thanks Greg,
>>>
>>> I just want to note that for the short notice it is unlikely we will be
>>> able to have answers to feed the discussion in our call tomorrow.
>>>
>>>
>>> Best regards,
>>>
>>>
>>> León
>>>
>>> El 20/04/2015, a las 23:22, List for the work of CCWG-Accountability
>>> Legal SubTeam <ccwg-accountability5 at icann.org> escribió:
>>>
>>> I am forwarding Chris Disspain's email into the Legal Sub Team for
>>> further consideration.  I will let our counsels respond, should the Legal
>>> Sub Team's discussion result in a referral of the questions to counsel.
>>>
>>>
>>> Greg Shatan
>>>
>>> ---------- Forwarded message ----------
>>> From: Chris Disspain <ceo at auda.org.au>
>>> Date: Tue, Apr 21, 2015 at 12:03 AM
>>> Subject: [CCWG-ACCT] Legal question
>>> To: Accountability Cross Community <
>>> accountability-cross-community at icann.org>
>>>
>>>
>>> Hello All,
>>>
>>> I’m not sure if this email should be addressed to the whole group, the
>>> legal sub-team or some other. Anyway, I have some questions that I would
>>> appreciate answers to from the CCWG’s lawyers. Happy to discuss on the
>>> upcoming CCWG call.
>>>
>>> Under the current structure of ICANN and its SOs and ACs
>>>
>>> 1. Is it correct that a bylaw saying that a combination of those SOs and
>>> ACs can veto the budget or veto a bylaw change can be drafted and put in to
>>> the bylaws?
>>>
>>> 2. Is it correct that were there to be such a bylaw and the SOs and ACs
>>> were to veto the budget or a bylaw change pursuant to that bylaw then the
>>> Board of ICANN could ignore that veto and that the SOs and ACs could not
>>> enforce the veto?
>>>
>>> 3. Is it correct that the veto bylaw could be drafted to require binding
>>> arbitration in the event that the Board refused to follow the SO/AC veto
>>> and if so would the Board be bound by the arbitration finding?
>>>
>>> 4. Is it correct that a Board spill bylaw could be inserted in to the
>>> bylaws and if triggered would be enforceable?
>>>
>>>
>>>
>>> Cheers,
>>>
>>>
>>> Chris
>>>
>>> On 18 Apr 2015, at 14:50 , León Felipe Sánchez Ambía <
>>> leonfelipe at sanchez.mx> wrote:
>>>
>>> All,
>>>
>>> I am forwarding this document from Counsel for your records and for its
>>> relevance for our overall work.
>>>
>>>
>>> Best regards,
>>>
>>>
>>> León
>>>
>>> Inicio del mensaje reenviado:
>>>
>>> *Para: *"ccwg-accountability5 at icann.org" <ccwg-accountability5 at icann.org
>>> >
>>> *Fecha: *17 de abril de 2015 22:21:36 GMT-5
>>> *De: *List for the work of CCWG-Accountability Legal SubTeam <
>>> ccwg-accountability5 at icann.org>
>>> *Asunto: **[Acct-Legal] (no subject)*
>>> *Responder a: *ccwg-accountability5 at icann.org
>>>
>>>
>>>
>>> Dear Legal Sub-Team,  Attached please find revisions to the chart
>>> comparing the member and designator approaches  from Sidley and Adler &
>>> Colvin as requested.  Please note that in our cover memo we have posed
>>> several questions for your consideration.  We have also provided a
>>> discussion of some considerations regarding implementation of both
>>> approaches.  We are look forward to discussing with CCWG next week.  Kind
>>> regards, Holly
>>>
>>> *HOLLY J.  GREGORY*
>>>
>>> *Partner*
>>> *Sidley Austin LLP*
>>> +1.212.839.5853
>>> holly.gregory at sidley.com
>>>
>>>
>>>
>>>
>>>
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>>>
>>> <Legal Assessment_  Governance Chart.pdf>
>>>
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