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The ALAC has been raising this issue multiple times with no
answers.<br><br>
Another related question is whether we can require a binding pre-seating
letter saying that the director waives all rights to sue for defamations
(or whatever) related to the removal process.<br><br>
Alan<br><br>
At 14/12/2015 03:29 PM, Aikman-Scalese, Anne wrote:<br><br>
<blockquote type=cite class=cite cite="">If the Chairs want to
certify the legal questions, I think these would be:<br>
<br>
1. Is it possible for a Director to
bring suit for libel, slander, or other causes of action during the
community enforcement removal process or thereafter based on the
“written justification” laid out by the SO/AC and/or oral statements
made during the required conference calls in the Community
enforcement process?<br>
<br>
2. Could a Director seek injunctive
and/or declaratory relief to interrupt the community enforcement process
toward removal? If so, would SOs/ACs and officers who are sued be
required to mount their own defense? How expensive would this
be?<br>
<br>
3. Is there insurance coverage
available for SOs/ACs and their officers in relation to possible suit by
a director in jeopardy of being removed or who has been removed from the
Board? If so, how expensive is it?<br>
<br>
These are not questions about how likely the action is to
occur. That does not really figure into the “chilling
effect” that is of concern when the officer of an SO or AC is drafting
the “written justification” and/or encouraging open
discussion in the required (and recorded for posterity) conference
call.<br>
Anne<br>
<br>
<img src="cid:.0" width=150 height=62 alt="[]"><br>
<b>Anne E. Aikman-Scalese, Of Counsel<br>
Lewis Roca Rothgerber LLP<br>
One South Church Avenue Suite 700 | Tucson, Arizona 85701-1611<br>
(T) 520.629.4428 | (F) 520.879.4725<br>
<a href="mailto:AAikman@lrrlaw.com">AAikman@lrrlaw.com</a> |
<a href="http://www.lrrlaw.com/" eudora="autourl">www.LRRLaw.com</a><br>
</b> <br>
<b> <br>
</b> <br>
<b>From:</b> Gregory, Holly
[<a href="mailto:holly.gregory@sidley.com" eudora="autourl">
mailto:holly.gregory@sidley.com</a>] <br>
<b>Sent:</b> Monday, December 14, 2015 1:14 PM<br>
<b>To:</b> Aikman-Scalese, Anne; 'Steve DelBianco'<br>
<b>Cc:</b> gregshatanipc@gmail.com; 'Phil Corwin'; cwilson@21cf.com;
Rosemary Fei (rfei@adlercolvin.com); Thomas Rickert;
ipc_accountabilityct@icann.org; 'Gomes, Chuck' (cgomes@verisign.com);
Rosemary Fei (rfei@adlercolvin.com); Sidley ICANN CCWG;
ICANN@adlercolvin.com<br>
<b>Subject:</b> RE: CCWG - ACCT - Recommendation 4 - Community
Powers<br>
<br>
We must await further direction from the co-chairs whether this is
something that they would like research on under California law<br>
<br>
<b>HOLLY</b> <b>GREGORY</b><br>
Partner<br><br>
<b>Sidley Austin LLP<br>
</b>+1 212 839 5853<br>
<a href="mailto:holly.gregory@sidley.com">holly.gregory@sidley.com</a><br>
<br>
<b>From:</b> Aikman-Scalese, Anne
[<a href="mailto:AAikman@lrrlaw.com">mailto:AAikman@lrrlaw.com</a>] <br>
<b>Sent:</b> Monday, December 14, 2015 3:03 PM<br>
<b>To:</b> Gregory, Holly; 'Steve DelBianco'<br>
<b>Cc:</b>
<a href="mailto:gregshatanipc@gmail.com">gregshatanipc@gmail.com</a>;
'Phil Corwin'; <a href="mailto:cwilson@21cf.com">cwilson@21cf.com</a>;
Rosemary Fei
(<a href="mailto:rfei@adlercolvin.com">rfei@adlercolvin.com</a>); Thomas
Rickert;
<a href="mailto:ipc_accountabilityct@icann.org">
ipc_accountabilityct@icann.org</a>; 'Gomes, Chuck'
(<a href="mailto:cgomes@verisign.com">cgomes@verisign.com</a>)<br>
<b>Subject:</b> RE: CCWG - ACCT - Recommendation 4 - Community
Powers<br>
<br>
Holly I would tend to agree if in fact the SO or AC ccould remove a
director without cause and did not have to state its reasons, but the
community process requires this and it is discussed fully throughout four
steps of the Community process to director removal. The SO or
AC must state “written justification”, to which the Board has now
added its “Clear Rationale” comment. <br>
<br>
One need only look at the differences of opinion that arose with respect
to .africa to understand that a stated reason for removal which has a
“written justification” or Clear Rationale from the SO/AC standpoint
could easily form the basis of a suit by a director. It does not
require much by way of theory for a plaintiff’s lawyer to allege claims
of libel and even irreparable harm. <u>The SO/AC would likely
need legal advice just to draft the “written
justification.”</u> <br>
<br>
Again, I do not think indemnification represents a reasonable risk to
ICANN as a corporation. The risk should be limited by contract when
directors take office. Directors should not be suing the SO/AC
and/or its officers for removal. Otherwise, the ultimate enforcement
mechanism in the Sole Designator Model is not effective.<br>
<br>
You may not have seen this fact situation occur. That does not mean
it would not occur at ICANN. We have some fairly feisty folks in
our midst. The risk of suit is of course much higher
than the risk of success on the merits. I would say it is
hard to measure in dollars the potential damage to an individual
associated with being removed from the ICANN Board with “written
justification”. It could be a pretty good
strategy for a director who wants to interrupt the Community Enforcement
process. He or she may also have the full support of other
Directors willing to testify.<br>
Anne <br>
<br>
<img src="cid:.0" width=150 height=62 alt="[]"><br>
<b>Anne E. Aikman-Scalese, Of Counsel<br>
Lewis Roca Rothgerber LLP<br>
One South Church Avenue Suite 700 | Tucson, Arizona 85701-1611<br>
(T) 520.629.4428 | (F) 520.879.4725<br>
<a href="mailto:AAikman@lrrlaw.com">AAikman@lrrlaw.com</a> |
<a href="http://www.lrrlaw.com/" eudora="autourl">www.LRRLaw.com</a><br>
</b> <br>
<b> <br>
</b> <br>
<b>From:</b> Gregory, Holly
[<a href="mailto:holly.gregory@sidley.com">
mailto:holly.gregory@sidley.com</a>] <br>
<b>Sent:</b> Monday, December 14, 2015 12:43 PM<br>
<b>To:</b> Aikman-Scalese, Anne; 'Steve DelBianco'<br>
<b>Cc:</b>
<a href="mailto:gregshatanipc@gmail.com">gregshatanipc@gmail.com</a>;
'Phil Corwin'; <a href="mailto:cwilson@21cf.com">cwilson@21cf.com</a>;
Rosemary Fei
(<a href="mailto:rfei@adlercolvin.com">rfei@adlercolvin.com</a>); Thomas
Rickert<br>
<b>Subject:</b> RE: CCWG - ACCT - Recommendation 4 - Community
Powers<br>
<br>
Anne, My sense is that the concerns you raise present an extremely low
risk of suit and hence low risk of indemnificcation and cost of
indemnification. In my many years of corporate governance practice
I cannot recall a lawsuit for libel or defamation by a director in an
instance of removal. But we can research under California law if
the co-chairs certify. Also, I am not aware of any theory of libel
or defamation that would give rise to injunctive relief delaying such
removal where the designator has the right to remove with or without
cause as here. Again, we have not researched this specific point under
California law but will do so if certified. Holly <br>
<br>
<b>HOLLY</b> <b>GREGORY</b><br>
Partner<br><br>
<b>Sidley Austin LLP<br>
</b>+1 212 839 5853<br>
<a href="mailto:holly.gregory@sidley.com">holly.gregory@sidley.com</a><br>
<br>
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