<div dir="ltr"><div class="gmail_default" style="font-size:small">They are not a corporation. ICANN is a non-profit that jumped from over $72,000,000 in 2012 reported to almost $250,000,000 in 2013 reported.<br><br></div><div class="gmail_default" style="font-size:small">Where are you getting this "corporate" notion from? Is ICANN planning to shift from non-profit to profit?<br><span style="font-size:12pt;line-height:107%;font-family:"Times New Roman",serif"></span></div></div><div class="gmail_extra"><br><div class="gmail_quote">On Wed, Jan 7, 2015 at 11:06 PM, Edward Morris <span dir="ltr"><<a href="mailto:emorris@milk.toast.net" target="_blank">emorris@milk.toast.net</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex"><div>
<div style="font-size:13px;font-family:Tahoma;color:rgb(0,0,0);font-weight:400;font-style:normal;background-image:none;background-color:rgba(0,0,0,0);background-repeat:repeat repeat"><span style="color:rgb(34,34,34);font-family:arial,sans-serif;font-size:small;background-color:rgb(255,255,255)">A few
comments on some quite interesting posts:</span>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">1. I think it is important to
acknowledge at the outset that the only way we will be able to create and
implement any type of membership based organisational structure is if
everyone 1) checks their egos at the door, 2) actually listen to the
concerns and needs of the other groups and 3) understands there will have to
be a lot of compromises to get to a product we can all live with, if not
completely agree with in every detail.</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">I'm as big a supporter of
creating a membership based ICANN as you're likely going to find in the
noncommercial community yet Robin is right: I could never sell an
organisational scheme to my colleagues that is based upon what we consider
to be the unequal and biased representation scheme embedded in the
constituency model. Yet I realise the commercial community, registrars - on
down the line - all groups have their own needs, wants and desires.
We're going to have to be creative, perhaps, for example, by
creating different membership classes, while recognising that 1) we
don't have the time to re-fight past battles and 2) every group in ICANN
will have to buy into the final product or we will not succeed. There are a
lot of people on the outside who believe we are destined to fail: let's
not prove them right.</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">2. I agree with Greg: it's too
early to sort exactly what powers we want to give to Members. That said, if
we are to become a California Public Benefits Corporation with members,
there are two potent statutory provisions of the California
Corporations Code that are designed to make the Board accountable to its
Members:</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">a. California Corporations Code
§5222 allows Members to remove Board members without cause provided
certain voting thresholds are met. The general rule is that a majority vote
would suffice for the removal, but the statute has a number of provisions
that makes things a bit more complex. The threshold is generally not
something we would decide, it's there in the statute. </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">b. California Corporations Code
§5710 allows for Members Derivative Actions. A derivative action is
perhaps the most potent accountability tool available for Members /
shareholders in any corporation: the right to sue on behalf of the
corporation those harming the corporation. Well, it's a bit more
complicated than that but that is the general idea. I'm a huge supporter
of derivative actions as a means of ensuring the ultimate accountability of
the Board. I realise, however, not everyone shares my enthusiasm and this
may be a lightening rod for those opposing the membership scheme.</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">3. I just wanted to briefly note that
California Corporations Code §5152 does provide for something called
"delegates" which have "some or all of the authority of
members". This could be considered if we decide to go to a membership
type based organization but don't want to give all of the statutory
powers provided under California law to our members.</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">Thanks to everyone for contributing
to such a lively and important conversation.</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">Best,</div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)"> </div>
<div style="color:rgb(34,34,34);font-family:arial,sans-serif;background-color:rgb(255,255,255)">Ed Morris</div>
</div>
<div style="font-size:13px;font-family:Tahoma;color:rgb(0,0,0);font-weight:400;font-style:normal;background-image:none;background-color:rgba(0,0,0,0);background-repeat:repeat repeat">
<blockquote style="PADDING-RIGHT:0px;PADDING-LEFT:5px;MARGIN-LEFT:5px;BORDER-LEFT:#000000 2px solid;MARGIN-RIGHT:0px">-----Original
Message-----<br>
From: Robin Gross <<a href="mailto:robin@ipjustice.org" target="_blank">robin@ipjustice.org</a>><br>
To: Accountability Cross Community
<<a href="mailto:accountability-cross-community@icann.org" target="_blank">accountability-cross-community@icann.org</a>><br>
Date: Wed, 7 Jan 2015 11:44:28 -0800<br>
Subject: Re: [CCWG-Accountability] Regarding Non-profit and public-benefit
legal structure<br>
<div>One of the concerns I have with this proposed model is how
non-commercial users as a whole would be treated. Non-commercial users
had to fight for many years simply to achieve parity in representation with
commercial users within the GNSO. My concern is that this type of
model simply re-opens the door for non-commercial users to go back to a
model of inequality with commercial users (if representation rights are
given to "constituencies" rather than "stakeholder
groups"). NCSG has members who do not belong to any constituency
or who belong to more than one. So the devil is in the details of how
these models are created. The same old battles fought among
stakeholders for greater proportional representation will carry over to the
development of the "member" model. It isn't a simple
solution when you get into the specific details of precisely how
representation is apportioned. Details like whether it is to
"constituencies" or to "stakeholder groups" have a lot
of impact and will be hard fought as a result. So this 1 example
illustrates the concern I have about how this model could impact the
stakeholder group I represent and perhaps not be quite as simple as it seems
at first glance. I'm sure other stakeholders might have similar
concerns. Who is a "member" and how much proportional
representation is afforded will present the same old battles, just in a new
suit.</div>
<div> </div>
<div>Thanks,</div>
<div>Robin</div>
<div>
<div>On Jan 7, 2015, at 11:08 AM, Steve DelBianco wrote:</div>
<blockquote type="cite">
<div style="word-wrap:break-word;color:rgb(0,0,0);font-size:16px;font-family:Calibri,sans-serif">
<div>
<div>Some clarifications about the Member concept, as described on the <a href="https://community.icann.org/pages/viewpage.action?pageId=51416471" target="_blank">
Work Area 2 inventory</a>:</div>
<blockquote style="margin:0 0 0 40px;border:none;padding:0px" type="cite">
<div> </div>
<div>Members are not outside of ICANN — they are designated by their
respective AC/SO/Constituencies. So not sure there is much risk that a
majority of these Members could be captured.</div>
<div> </div>
<div>Members would be given only these enumerated powers:</div>
<blockquote style="margin:0 0 0 40px;border:none;padding:0px" type="cite">
<div>Appoint members of Affirmation Review teams</div>
<div>Review [and perhaps reverse] any board decision. Non-approval
would send decision back to bottom-up policy development process.</div>
<div>Approve proposed changes to ICANN Bylaws or Articles of
Incorporation.</div>
<div>Approve annual proposed budget </div>
</blockquote>
<div> </div>
<div>Members could <u>not</u> re-write contracts or budgets or bylaws.
If a bottom-up consensus process generated a bylaws change that was
rejected by the board, the Members could reverse that decision,
however.</div>
</blockquote>
<div>
<div>
<blockquote style="margin:0 0 0 40px;border:none;padding:0px" type="cite">
</blockquote>
<div>
<div>Steve DelBianco</div>
<div> </div>
</div>
</div>
</div>
</div>
<div style="font-family:Calibri;font-size:12pt;text-align:left;color:black;BORDER-BOTTOM:medium none;BORDER-LEFT:medium none;PADDING-BOTTOM:0in;PADDING-LEFT:0in;PADDING-RIGHT:0in;BORDER-TOP:#b5c4df 1pt solid;BORDER-RIGHT:medium none;PADDING-TOP:3pt"><span><span style="font-weight:bold">From: </span>Greg
Shatan <<a href="mailto:gregshatanipc@gmail.com" target="_blank">
gregshatanipc@gmail.com</a>><br>
<span style="font-weight:bold">Date: </span>Wednesday, January 7, 2015 at
12:45 PM<br>
<span style="font-weight:bold">Cc: </span>"<a href="mailto:accountability-cross-community@icann.org" target="_blank">
accountability-cross-community@icann.org</a>" <<a href="mailto:accountability-cross-community@icann.org" target="_blank">
accountability-cross-community@icann.org</a>><br>
<span style="font-weight:bold">Subject: </span>Re: [CCWG-Accountability]
Regarding Non-profit and public-benefit legal structure</span></div>
<div> </div>
<div>
<div>
<div dir="ltr"><span>I would not rush to the
conclusion that a membership group is per se prone to capture. A
poorly designed membership group, yes. The devil is in the details --
who are the members? if they are individuals, who do they represent? how do
they act? when can they act, and how quickly? how many of them are there?
what are their powers? who is excluded? are there classes of members? is
voting weighted? </span>
<div> </div>
<span> </span>
<div><span>Also, I'm not sure if (or why) the
community accountability mechanism needs to be "outside"
(depending on what that means). Members in a membership corporation
are not really outside, unless I am not getting the sense of the word as
used here.</span></div>
<span> </span>
<div> </div>
<span> </span>
<div><span>As for the dispute resolution
mechanism, that will depend on the other two factors (among other
things). If the members have the "last word" on something,
and the board fails to act, binding arbitration (or litigation) would be a
reasonable step (although some escalation mechanisms might be appropriate
before getting there).</span></div>
<span> </span>
<div> </div>
<span> </span>
<div><span>Greg Shatan</span>
<div> </div>
<span> </span></div>
<span> </span></div>
<div class="gmail_extra">
<div class="gmail_quote"><span>On Wed, Jan 7, 2015
at 10:37 AM, Paul Rosenzweig <span dir="ltr"> <<a href="mailto:paul.rosenzweig@redbranchconsulting.com" target="_blank">
paul.rosenzweig@redbranchconsulting.com</a>></span> wrote:</span>
<blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex" type="cite">
<div bgcolor="white" link="blue" vlink="purple" lang="EN-US">
<div class="MsoNormal"><span><span style="font-size:11pt;font-family:Calibri,sans-serif;color:rgb(31,73,125)">I think that the potential for capture of the outside member group is
the reason that the accountability system probably needs to be linked to an
independent judicial/arbitral function to resolve disputes. [Of
course that institution, too, could be captured … but at some point
we have to end the “who guards the guardians?” question].
And that, in turn emphasizes why it is necessary as part of the transition
to define the Board’s/ICANN’s scope of authority. A
judicial/arbitral function can only resolve disputes and cabin capture/abuse
if it has an articulated standard against which to measure the
dispute. In the absence of such pre-existing guidance the
judiciary/arbiter is simply substituting his/her/its own judgment for the
Board and the Community, which is not a good thing.</span></span></div>
<div class="MsoNormal"><span><span style="font-size:11pt;font-family:Calibri,sans-serif;color:rgb(31,73,125)">Hence the bottom line: We need a) an outside accountability
mechanism representing the community; b) an independent dispute resolution
mechanism; and c) clearly articulated standards against which to measure and
resolve any dispute</span><span style="color:rgb(31,73,125);font-size:11pt"> </span></span></div>
<div class="MsoNormal"><span><span style="font-size:11pt;font-family:Calibri,sans-serif;color:rgb(31,73,125)">Paul</span></span></div>
<div class="MsoNormal"><span><span style="font-size:11pt;font-family:Calibri,sans-serif;color:rgb(31,73,125)"> </span></span></div>
<div>
<div style="border:none;border-top:solid #e1e1e1 1.0pt;padding:3.0pt 0in 0in 0in">
<div class="MsoNormal"><span><b><span style="font-size:11pt;font-family:Calibri,sans-serif;color:windowtext">From:</span></b><span style="font-size:11pt;font-family:Calibri,sans-serif;color:windowtext"> Mathieu Weill [mailto:<a href="mailto:mathieu.weill@afnic.fr" target="_blank">
mathieu.weill@afnic.fr</a>]<br>
<b>Sent:</b> Wednesday, January 7, 2015 9:04 AM<br>
<b>To:</b> <a href="mailto:accountability-cross-community@icann.org" target="_blank"> accountability-cross-community@icann.org</a><br>
<b>Subject:</b> Re: [CCWG-Accountability] Regarding Non-profit and
public-benefit legal structure</span></span></div>
</div>
</div>
<div>
<div>
<div class="MsoNormal"><span> </span></div>
<div class="MsoNormal"><span>Dear Colleagues,<br>
<br>
Many thanks for this very valuable discussion.<br>
<br>
While it confirms that our initial orientation towards the ability to,
somehow, oversee the Board, is relevant and worth exploring, the latest
comments (regarding risk of capture) highlight that we should also
anticipate on the accountability of the overseeing mechanism itself.<br>
<br>
If "the community" (through a mechanism yet to be determined)
oversees Board and staff, can we ensure all stakeholders, especially those
who are less familiar with Icann, that "the community", in turn,
is accountable (ie has the relevant independent checks and balances, review
and redress mechanisms) ? A significant challenge, but I'm confident our
group can address that.<br>
<br>
This aspect might, however, need to be addressed in our definition of WS1,
if there is agreement that is a necessary element for the transition to take
place.<br>
<br>
Best,<br>
Mathieu<br>
<br>
<br>
<br>
Le 07/01/2015 09:07, Dr Eberhard W Lisse a écrit :</span><br>
</div>
<blockquote style="margin-top:5.0pt;margin-bottom:5.0pt" type="cite">
<div>
<div class="MsoNormal"><span>I am not interested
much in the details, interesting as they are :-)-O, but would like to pick
up on Bruce's last paragraph, because in my view, the
"membership supervision" is not going to help much as it is prone
to capture, quite the opposite of the accountability we want.</span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>greetings, el</span>
</div>
</div>
<div>
<div class="MsoNormal"><br>
<span>Sent from Dr Lisse's iPad mini</span>
</div>
</div>
<div>
<div class="MsoNormal" style="margin-bottom:12.0pt"><br>
<span>On Jan 7, 2015, at 02:40, Greg Shatan <<a href="mailto:gregshatanipc@gmail.com" target="_blank">
gregshatanipc@gmail.com</a>> wrote:</span></div>
</div>
<blockquote style="margin-top:5.0pt;margin-bottom:5.0pt" type="cite">
<div>
<div>
<div class="MsoNormal"><span>What Bruce has set
forth is close to correct. However, I can't help but do a little
legal nit-picking. </span></div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>"Public benefit
corporation" is a term used in California (among other places) as a
term for non-profit corporations generally. (In New York State, we use
the term "not-for-profit corporation" to mean basically the same
thing as a California "public benefit corporation" (and we use the
term "public benefit corporation" to mean something quite
different -- a quasi-public corporation like the Metropolitan Transport
Authority).) California public benefit corporations are not really
"chartered by the state" (though New York ones like the MTA are
chartered by the state). [Wikipedia isn't always a great
source....]</span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>In California, public
benefit corporations may be created with or without members, or may convert
from member to non-member and vice versa. However, a public benefit
corporation with members is still a public benefit corporation. </span>
</div>
</div>
<div>
<div class="MsoNormal"><span>(California also has
"mutual benefit corporations" which are non-profit but never
charitable (and are also not tax-exempt). Mutual benefit corporations
are run for the benefit of their members, and not for the benefit of the
general public.)</span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>The term
"member" can also be used to mean people (or organizations) who
aren't really members. For instance, when you become a
"member" of a museum, you are not becoming a member of the
corporation (i.e., what some in ICANN-land have termed a "statutory
member"). These non-statutory "memberships" are more
for marketing purposes and have no governance role. "Statutory
members" on the other hand, have a role in governance (which can vary
markedly depending on the by-laws of the particular corporation.</span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>Hope this
helps.</span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>Best regards,</span>
</div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
</div>
<div>
<div class="MsoNormal"><span>Greg Shatan</span>
</div>
</div>
<div>
<div class="MsoNormal"><span>(Speaking for myself,
and not giving legal advice as I am not a member of the California
Bar)</span></div>
</div>
</div>
<div>
<div class="MsoNormal"><span> </span></div>
<div>
<div class="MsoNormal"><span>On Tue, Jan 6, 2015
at 6:54 PM, Bruce Tonkin <<a href="mailto:Bruce.Tonkin@melbourneit.com.au" target="_blank">
Bruce.Tonkin@melbourneit.com.au</a>> wrote:</span></div>
<blockquote style="border:none;border-left:solid #cccccc 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in" type="cite">
<div class="MsoNormal"><span>Hello Phil,<br>
<br>
<br>
>> I would envisage the Board having to be compliance with
all Corporate Governance Codes specific to Companies Law in the country of
incorporation, subject to a community consensus override. But what is its
corporate status - not for profit or for profit - as different codes would
apply ?<br>
<br>
The legal status of ICANN is as specified in its articles of
incorporation:<br>
<br>
<a href="https://www.icann.org/resources/pages/articles-2012-02-25-en" target="_blank">
https://www.icann.org/resources/pages/articles-2012-02-25-en</a><br>
<br>
"This Corporation is a non-profit public benefit corporation and is not
organized for the private gain of any person. It is organized under the
California Non-profit Public Benefit Corporation Law for charitable and
public purposes. The Corporation is organized, and will be operated,
exclusively for charitable, educational, and scientific purposes within the
meaning of § 501 (c)(3) of the Internal Revenue Code of 1986, as
amended (the "Code"), or the corresponding provision of any future
United States tax code. Any reference in these Articles to the Code shall
include the corresponding provisions of any further United States tax
code."<br>
<br>
Also from:<br>
<br>
<a href="http://en.wikipedia.org/wiki/Public-benefit_nonprofit_corporation" target="_blank">
http://en.wikipedia.org/wiki/Public-benefit_nonprofit_corporation</a><br>
<br>
"A public-benefit non-profit corporation is a type of non-profit
corporation chartered by a state government, and organized primarily or
exclusively for social, educational, recreational or charitable purposes by
like-minded citizens. Public-benefit nonprofit corporations are
distinct in the law from mutual-benefit nonprofit corporations in that they
are organized for the general public benefit, rather than for the interest
of its members."<br>
<br>
I believe it was deliberately set up as public benefit rather than a member
organization - to avoid the situation where the members become limited to
say gTLD registries and registrars and hence it ends up operating primarily
for the benefit of the domain name registration industry.<br>
<br>
Any move away from a public-benefit corporation to a membership corporation
- would need to carefully consider how to ensure that the members are
reflective of the broader Internet community and don't become limited to
a few members as interest in "ICANN" drops over time.
I.e. a failure scenario of membership organisation is what happens to
the membership base over time and how it can be protected from
capture. I have seen some membership based ccTLDs get into
problems when their membership becomes dominated by domain name investors
for example.<br>
<br>
Regards,<br>
Bruce Tonkin<br>
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</blockquote>
</div>
<div class="MsoNormal"><span> </span></div>
</div>
</div>
</blockquote>
<blockquote style="margin-top:5.0pt;margin-bottom:5.0pt" type="cite">
<div>
<div class="MsoNormal"><span>
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</blockquote>
<div class="MsoNormal"><br>
<br>
</div>
<pre><span>
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</blockquote>
<div class="MsoNormal"><br>
</div>
<pre><span>-- </span></pre>
<pre><span>*****************************</span></pre>
<pre><span>Mathieu WEILL</span></pre>
<pre><span>AFNIC - directeur
général</span></pre>
<pre><span>Tél: <a href="tel:%2B33%201%2039%2030%2083%2006" value="+33139308306" target="_blank">+33 1 39 30 83 06</a></span></pre>
<pre><span><a href="mailto:mathieu.weill@afnic.fr" target="_blank">mathieu.weill@afnic.fr</a></span></pre>
<pre><span>Twitter : @mathieuweill</span></pre>
<pre><span>*****************************</span></pre>
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https://mm.icann.org/mailman/listinfo/accountability-cross-community</a>
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Accountability-Cross-Community@icann.org</a><br>
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<br></blockquote></div><br><br clear="all"><br>-- <br><div class="gmail_signature"><div dir="ltr"><div>Sincerely</div>
<div>CARRIE Devorah</div>
<div>
<div>562 688 2883</div><br> <br>
<br><font size="1"><span style="FONT-FAMILY:Arial">DISCLAIMER : </span></font></div>
<div><font size="1"><span style="FONT-FAMILY:Arial"></span><span style="FONT-FAMILY:Arial">With the continuing crossing and interfacing of platforms both on & off line both with & without our knowledge nor approval to note nothing sent over the Internet anymore is ever private nor should be presumed to be so. If it is that much of a secret, say nothing. If you must? Take a lesson from our military- hand write the note, chew then swallow <span> </span></span></font></div>
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