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Hi Jorge, <br>
<br>
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.) ? <br>
<br>
This is certainly an aspect we need to clarify . <br>
<br>
Best<br>
Mathieu<br>
<br>
Le 02/10/2015 11:43, <a class="moz-txt-link-abbreviated" href="mailto:Jorge.Cancio@bakom.admin.ch">Jorge.Cancio@bakom.admin.ch</a> a écrit :<br>
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<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US">Hi Mathieu,<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">I’ve
tried to specify the question a bit more, and it would look
as follows:<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">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:<o:p></o:p></span></p>
<p class="MsoListParagraph"
style="margin-left:36.0pt;text-indent:-18.0pt;mso-list:l0
level1 lfo3">
<!--[if !supportLists]--><span
style="font-size:12.0pt;font-family:Symbol;mso-fareast-language:DE-CH"
lang="EN-US"><span style="mso-list:Ignore">·<span
style="font:7.0pt "Times New Roman"">
</span></span></span><!--[endif]--><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">concretizing
these fiduciary duties in the Bylaws;</span><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p></o:p></span></p>
<p class="MsoListParagraph"
style="margin-left:36.0pt;text-indent:-18.0pt;mso-list:l0
level1 lfo3">
<!--[if !supportLists]--><span
style="font-size:12.0pt;font-family:Symbol;mso-fareast-language:DE-CH"
lang="EN-US"><span style="mso-list:Ignore">·<span
style="font:7.0pt "Times New Roman"">
</span></span></span><!--[endif]--><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">subjecting
their correct interpretation to arbitration;</span><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p></o:p></span></p>
<p class="MsoListParagraph"
style="margin-left:36.0pt;text-indent:-18.0pt;mso-list:l0
level1 lfo3">
<!--[if !supportLists]--><span
style="font-size:12.0pt;font-family:Symbol;mso-fareast-language:DE-CH"
lang="EN-US"><span style="mso-list:Ignore">·<span
style="font:7.0pt "Times New Roman"">
</span></span></span><!--[endif]--><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">imposing
special requirements on the rationale needed to be provided
if they are used to override community decisions;</span><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p></o:p></span></p>
<p class="MsoListParagraph"
style="margin-left:36.0pt;text-indent:-18.0pt;mso-list:l0
level1 lfo3">
<!--[if !supportLists]--><span
style="font-size:12.0pt;font-family:Symbol;mso-fareast-language:DE-CH"
lang="EN-US"><span style="mso-list:Ignore">·<span
style="font:7.0pt "Times New Roman"">
</span></span></span><!--[endif]--><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH" lang="EN-US">imposing
extra-supermajorities in the Board in order to being able to
invoke such duties?</span><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US">Please let me know if you can proceed with
this.<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"
lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH">Regards<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH"><o:p> </o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:windowtext;mso-fareast-language:DE-CH">Jorge<br>
<br>
</span><span style="color:#1F497D"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<div>
<div style="border:none;border-top:solid #E1E1E1
1.0pt;padding:3.0pt 0cm 0cm 0cm">
<p class="MsoNormal"><b><span
style="color:windowtext;mso-fareast-language:DE-CH"
lang="DE">Von:</span></b><span
style="color:windowtext;mso-fareast-language:DE-CH"
lang="DE"> Mathieu Weill [<a class="moz-txt-link-freetext" href="mailto:mathieu.weill@afnic.fr">mailto:mathieu.weill@afnic.fr</a>]
<br>
<b>Gesendet:</b> Freitag, 2. Oktober 2015 11:06<br>
<b>An:</b> Cancio Jorge BAKOM
<a class="moz-txt-link-rfc2396E" href="mailto:Jorge.Cancio@bakom.admin.ch"><Jorge.Cancio@bakom.admin.ch></a>;
<a class="moz-txt-link-abbreviated" href="mailto:accountability-cross-community@icann.org">accountability-cross-community@icann.org</a><br>
<b>Cc:</b> <a class="moz-txt-link-abbreviated" href="mailto:leonfelipe@sanchez.mx">leonfelipe@sanchez.mx</a>; <a class="moz-txt-link-abbreviated" href="mailto:thomas@rickert.net">thomas@rickert.net</a><br>
<b>Betreff:</b> Re: question on fiduciary duties and
their objectivity<o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><span lang="EN-US"><o:p> </o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">Dear Jorge, <br>
<br>
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. $<br>
<br>
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 :<br>
<br>
</span><span
style="font-size:12.0pt;mso-fareast-language:DE-CH"
lang="EN-US"><o:p></o:p></span></p>
<blockquote style="margin-top:5.0pt;margin-bottom:5.0pt">
<p class="MsoListParagraph" style="margin-left:72.0pt"><span
lang="EN-US">o</span><span style="font-size:7.0pt"
lang="EN-US">
</span><span lang="EN-US">Clarifying understanding of the
fiduciary duties of Board Directors and related
expectations concerning Director behavior for the Board.</span><span
lang="EN-US"><o:p></o:p></span></p>
</blockquote>
<p class="MsoNormal" style="margin-bottom:12.0pt"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH"><br>
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 (<a moz-do-not-send="true"
href="https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20Cover%20Memo%20and%20Templates.pdf?version=3&modificationDate=1428797461000&api=v2">https://community.icann.org/download/attachments/52890082/Combined%20CCWG%20Cover%20Memo%20and%20Templates.pdf?version=3&modificationDate=1428797461000&api=v2</a>)
which addresses the balance between accountability and
decision making authority.
<br>
<br>
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) ?
<br>
<br>
Best<br>
Mathieu<br>
<o:p></o:p></span></p>
<div>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH">Le
01/10/2015 10:41,
<a moz-do-not-send="true"
href="mailto:Jorge.Cancio@bakom.admin.ch">Jorge.Cancio@bakom.admin.ch</a>
a écrit :<o:p></o:p></span></p>
</div>
<blockquote style="margin-top:5.0pt;margin-bottom:5.0pt">
<p class="MsoNormal"><span lang="EN-US">Dear all,<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">This is whether there
are any means to subject the exercise of “fiduciary
duties” (by the Board) to objective standards.<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">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.<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">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?)
<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">Hope this helps,<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">Regards<o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US"> <o:p></o:p></span></p>
<p class="MsoNormal"><span lang="EN-US">Jorge <o:p></o:p></span></p>
</blockquote>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-fareast-language:DE-CH"><br>
<br>
<o:p></o:p></span></p>
<pre>-- <o:p></o:p></pre>
<pre>*****************************<o:p></o:p></pre>
<pre>Mathieu WEILL<o:p></o:p></pre>
<pre>AFNIC - directeur général<o:p></o:p></pre>
<pre>Tél: +33 1 39 30 83 06<o:p></o:p></pre>
<pre><a moz-do-not-send="true" href="mailto:mathieu.weill@afnic.fr">mathieu.weill@afnic.fr</a><o:p></o:p></pre>
<pre>Twitter : @mathieuweill<o:p></o:p></pre>
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<pre class="moz-signature" cols="72">--
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Mathieu WEILL
AFNIC - directeur général
Tél: +33 1 39 30 83 06
<a class="moz-txt-link-abbreviated" href="mailto:mathieu.weill@afnic.fr">mathieu.weill@afnic.fr</a>
Twitter : @mathieuweill
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