<div dir="ltr">To Steve's point: all of the accountability measures proposed can be implemented, and perfectly legally, if ICANN's Board decides to make the relevant changes to its own bylaws. <div><br></div><div>If you read ICANN's lawyers' position carefully, you will see that they never say it is not possible, just that it is either not *currently* possible (because of the current bylaws), or that the law does not "provide" for that (not expressly, but it is legally possible).</div><div><br></div><div>My point, again, is two-fold:</div><div><br></div><div>1. What happens when the independent legal advice clashes with ICANN's internal legal advice? </div><div><br></div><div>I think everyone agrees that the ICANN Board is required to make changes to ICANN's bylaws for any of this to happen. So - what happens when they are told by their own lawyers it is not legal to make those changes? Because that is their current position.</div><div><br></div><div><br></div><div>2. The whole issue of anti-trust law (or, more accurately, ICANN's interpretation of anti-trust law). This has been used in the past by ICANN to explain why it cannot make changes but it has yet to be considered in this accountability process.</div><div><br></div><div><br></div><div><br></div><div><br></div><div>Kieren</div><div><br></div></div><div class="gmail_extra"><br><div class="gmail_quote">On Tue, Feb 17, 2015 at 12:31 PM, Steve DelBianco <span dir="ltr"><<a href="mailto:sdelbianco@netchoice.org" target="_blank">sdelbianco@netchoice.org</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex">
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We discussed that Bylaws provision several weeks ago, Rudi. </div>
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<div><font face="Calibri,sans-serif">California Nonprofit Corporation Law expressly authorizes non-profit organizations to have Members with ultimate authority to control the organization. Under Cal. Corp. Code § 5310 “A corporation may admit persons to Membership,
as provided in its Articles or Bylaws”. California law recognizes that Members may reserve the right to approve nonprofit actions and oversee the Board of Directors. (§ 5210) A Board of Directors’ authority to conduct the affairs of a nonprofit may be limited
by the rights of the Members specified in the law or in the nonprofit corporation’s Articles or Bylaws.</font></div>
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<div><font face="Calibri,sans-serif">Although ICANN does not currently have Members under Article XVII of its Bylaws, ICANN’s Articles of Incorporation expressly anticipate that ICANN may have Members: “These Articles may be amended by the affirmative of at
least two-thirds of the directors of the Corporation. When the Corporation has Members, amendments must be ratified by a two-thirds (2/3) majority of the Members voting on any proposed amendment.” (Section 9)</font></div>
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As you say, the ICANN bylaws presently say that ICANN won’t have members. But that Bylaw can be changed to allow Members as permitted in the Articles and under CA law.</div>
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<div>Steve DelBianco</div>
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<span style="font-weight:bold">From: </span>Rudolph Daniel<br>
<span style="font-weight:bold">Date: </span>Tuesday, February 17, 2015 at 3:21 PM<br>
<span style="font-weight:bold">To: </span>Kieren McCarthy<br>
<span style="font-weight:bold">Cc: </span>Accountability Cross Community<br>
<span style="font-weight:bold">Subject: </span>Re: [CCWG-ACCT] Thinking ahead - overcoming the legal obstacles to accountability</div><div><div class="h5">
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<p dir="ltr">Can I also point to the icann bylaws that states:<br>
Article 17: Members<br>
ICANN itself shall not have members, as defined by California Nonprofit Public Benefit Corporation Law.</p>
<p dir="ltr">May have missed this on the thread, but Cannot remember it being mentioned.</p>
<p dir="ltr">We would like to establish the importance of having this clause.<br>
Rudi Daniel</p>
<div class="gmail_quote">On Feb 17, 2015 3:13 PM, "Kieren McCarthy" <<a href="mailto:kieren@kierenmccarthy.com" target="_blank">kieren@kierenmccarthy.com</a>> wrote:<br type="attribution">
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<div dir="ltr">Hello all,
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<div>There have been no less than seven previous attempts to introduce real accountability at ICANN. They have all failed to achieve a fundamental goal: override or impact ICANN corporate (under whatever circumstances).</div>
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<div>In the specific cases where the override recommendations have been explicit, they have been undermined at the last step by ICANN internal legal advice.</div>
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<div>This group has, to some degree, learned from the past by deciding that it needs to get independent legal advice for its recommendations as part of the process. </div>
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<div>Even more usefully, ICANN's legal team has been prompted into providing its own legal analysis so we know what its position is ahead of time.</div>
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<div>Aside from the fact that I think allowing ICANN to pay for the external independent legal advice is foolish in the extreme, I see two fundamental issues for this group to discuss and reach agreement on if this process is to have the desired end result. </div>
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<div>And they are:</div>
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<div>1. What happens if/when the independent legal advice say a particular mechanism is perfectly legal but ICANN's internal legal advice say it isn't?</div>
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<div>What will Board members do? How do we ensure this discussion happens publicly and with plenty of time remaining?</div>
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<div>I think we should ask Board members now what they would do. Would they be willing to override internal legal advice, and under what circumstances? Will they commit to some kind of binding arbitration in the event that the two legal advices conflict in
fundamentally important ways?</div>
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<div>This is an almost inevitable scenario so let's get ahead of it now and make reasoned decisions before the pressure and politics come into play. Plan ahead.</div>
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<div>2. A fundamentally piece of the accountability mechanisms that are likely to be recommended includes making ICANN a member organization of some type.</div>
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<div>We have Jones Day on record as saying that don't think California law allows anyone but the Board to make final decisions (in fact, they don't actually say that if you read it carefully because they know it's not true).</div>
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<div>What we don't have is Jones Day/ICANN on record talking about the other legal get-out clause they have used in the past when it comes to accountability: anti-trust law.</div>
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<div>ICANN's particular interpretation of anti-trust law has been pulled out as a final defense multiple times but I haven't seen it yet in this latest round of accountability discussions, so it is more than possible that it is holding back that particular
defense now that the "California law corporate code" genie is out of the bottle. </div>
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<div>I can easily see a scenario where we all agree that it is possible to make these changes under California corporate law and then agree to hand over IANA to ICANN only to find that the Board discovers at the last minute that they also violate anti-trust
law and so, regretfully, cannot be implemented. </div>
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<div>So I would ask this group to try to get ICANN's formal position on anti-trust law with respect to possible changes and also get independent legal advice on that aspect too. </div>
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<div>I would also recommend that people go through previous failures to introduce recommendations and try to find what the legal justifications were that prevented them from being implemented. And then do the same pre-emptive work so we don't end up repeating
history. </div>
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<div>Hope this is useful.</div>
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<div>Kieren</div>
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