[Acct-Legal] Fwd: XPLANE update - please review

Sun May 3 07:20:19 UTC 2015

For clarity, in No. 4 below, I meant to say "seven SO/ACs" and not "seven GACs".

Josh

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________________________________
From: ccwg-accountability5-bounces at icann.org on behalf of List for the work of CCWG-Accountability Legal SubTeam
Sent: Sunday, May 03, 2015 01:38:41 AM
To: ccwg-accountability5 at icann.org
Subject: Re: [Acct-Legal] Fwd: XPLANE update - please review

Greg and CCWG Legal Sub-team,

Thanks for the note Greg, and we agree with your analysis, but also think the issue can be simplified for discussion and resolved in principle without significant amendment to the draft Report that will go out for public comment.  In addition, for this analysis we can leave the Nominating Committee to the side, as their role is limited to selecting (and removing) Directors, and do not otherwise exercise any of the community powers.

>From our prior discussions with CCWG, we have assumed that for various reasons the GAC (and perhaps other SOs and ACs) did not want to form unincorporated associations, which as we’ve stated precludes them from becoming “Members” of ICANN (Members must be legal persons).  Nonetheless, we understood that the CCWG still wanted the GAC and others to have an influential role, and believed that the community group mechanism articulated in 2.6.1.1 and 2.6.1.2 was designed to give effect to this goal, but without making those ACs Members.

Basically, the issue turns on whether three ACs – the GAC, the SSAC, and the RSSAC – should become Members (which entails becoming unincorporated associations) or should function as part of the community group but not as ICANN Members.  Either approach is legally viable and enforceable.

In summary:

1.       We have confirmed that ICANN can have classes of Members that do not have the right to select Directors (conversely, no right to remove their individual director either).  This applies to the GAC, RSSAC and SSAC.

2.       If desired, ICANN could have 7 Member Entities – GNSO, CCNSO, ASO, GAC, At-Large AC, SSAC, and RSSAC.

o   All 7 Members would share the right to exercise the Community Powers over (a) Budget, (b) Strategic Plan, (c) changes to Fundamental Bylaws, (d) changes to bylaws, and (e) recalling the full Board.  These decisions would be coordinated through the community group, with Members exercising their influence as articulated in Section 2.6.1.2 of the Report (with the weighted votes).

o   Four members – GNSO, CCNSO, ASO, and At-large AC – have the right to select Directors and recall their selected Directors.

3.       Nos. 1 and 2 above assumes that all the AC’s are willing to become unincorporated associations, including the GAC.

4.       If the assumption stated in No. 3 is not true for one or more of the seven GACs, then we can still have those Community Powers exercised through the 29 vote community group as proposed by CCWG in this report.  However, there will need to be an additional step for implementation purposes, which will put the decision of the community group to the voting Members.  This may necessitate a contract between the Members and the community group, which would require the community group to create an unincorporated association, or we may be able to achieve it through covenants in the bylaws.  To counsel, this is a second-tier implementation detail, and we have allowed for this in our comments to the draft Report (another copy of which is attached here for convenience).    If the public decides it’s too much to have Members and it would be better to give up full approval/veto rights over the budget and plan, and IANA Function review and recommendations, then this issue becomes moot (we could achieve the remaining community powers with Designators).

Happy to discuss further on Sunday if a call is necessary.

Cheers,
Josh

JOSHUA HOFHEIMER
Sidley Austin LLP
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From: ccwg-accountability5-bounces at icann.org [mailto:ccwg-accountability5-bounces at icann.org] On Behalf Of List for the work of CCWG-Accountability Legal SubTeam
Sent: Saturday, May 02, 2015 10:01 PM
To: ccwg-accountability5 at icann.org
Subject: [Acct-Legal] Fwd: XPLANE update - please review

Copying this to the rest of the Legal Sub Team.

Greg
---------- Forwarded message ----------
From: Greg Shatan <gregshatanipc at gmail.com<mailto:gregshatanipc at gmail.com>>
Date: Sun, May 3, 2015 at 12:25 AM
Subject: Re: XPLANE update - please review
To: "Gregory, Holly" <holly.gregory at sidley.com<mailto:holly.gregory at sidley.com>>
Cc: "Rosemary E. Fei" <rfei at adlercolvin.com<mailto:rfei at adlercolvin.com>>, Adam Peake <adam.peake at icann.org<mailto:adam.peake at icann.org>>, "Hofheimer, Joshua T." <jhofheimer at sidley.com<mailto:jhofheimer at sidley.com>>, Leon Sanchez <leonfelipe at sanchez.mx<mailto:leonfelipe at sanchez.mx>>, Sidley ICANN CCWG <sidleyicannccwg at sidley.com<mailto:sidleyicannccwg at sidley.com>>, ICANN-Adler <ICANN at adlercolvin.com<mailto:ICANN at adlercolvin.com>>

I think there is some confusion -- or at least, disconnection -- across the board here.  The XPLANE slides really need to align with the draft proposal.  I have not yet tried to do that -- I've been out today and need to pack and get ready for an early flight tomorrow.  I should be able to look at this more carefully on the flight (NY - San Diego, so I'll have some time....).  I'm not sure how to align this with everyone else's schedule and our publication schedule.

I think confusion centers on the different current and proposed community groupings -- their composition and what their powers, and how they relate to each other.

There are 3 groupings at play:

1.  The "Current Selectors": the 5 organizations that currently choose Board Members.
2.  The proposed Members or Designators.
3.  The "Empowered Community" (shown on each XPlane slide).

The problem is that we have not figured out the connection between these 3 groupings, because the composition of these 3 groupings is inconsistent.

The "Current Selectors" are:

GNSO: 2 board seats
ccNSO: 2 board seats
ASO: 2 board seats
ALAC: 1 board seat
NomCom: 8 board seats*
GAC, RSSAC, SSAC: 0 Board seats (each has one non-voting liaison)
----
*NomCom composition: GNSO (7), ALAC (5), ccNSO (1), ASO (1), IAB (for IETF) (1), GAC, RSSAC, SSAC (each 1 non-voting liaison)

If we follow directly from the "Current Selectors" the "Members" or "Designators" of ICANN would be the GNSO, the ccNSO, the ASO, ALAC. and the NomCom. The GAC, RSSAC and SSAC would not be Members or Designators (whether directly or through voting membership on the NomCom), because they have no voting role in choosing Directors.

This does not align with our ongoing discussion of who the Members or Designators would be.  Instead, we have discussed having Members or Designators that align with all 8 of these groups (although only 5 can choose Directors).

This in turn does not align with the "Empowered Community" that we seem to think should control the 5 community powers.  That would be the 7 groups shown on the Xplane slides, which excludes the NomCom, and gives seats (or at least "weights") to these 7 groups in a manner that does not relate to their power to appoint Directors.  Specifically, the GNSO, ccNSO, ASO, ALAC and GAC are given equal weight, the RSSAC and SSAC are given lesser weight, and the NomCom is disregarded.

We have not contemplated the linkage between "Current Selectors"; the organizations with the right to appoint board members (GNSO/ccNSO/ASO/ALAC/NomCom) and the Empowered Community (GNSO/ccNSO/ASO/ALAC/GAC/RSSAC/SSAC).  If the Current Selectors are the Members/Designators, how does the Empowered Community have the rights we want to give it?  If the Empowered Community are the Members/Designators, how do we deal with the fact that 3 Members/Designators have no right to appoint Directors, while the group that can appoint 8 Directors (i.e., the NomCom) is not a Member or Designator?  Would this be dealt with by an agreement among the 7 (or maybe 8) organizations (or more precisely, UAs aligned with these organizations)?

This needs to be figured out, and quickly....

Aside from this, there are more specific problems with the slides.  Slide 4 is particularly troublesome -- the right to remove individual directors should not be a right of the "Empowered Community." Instead it is a right that belongs to the GNSO, ccNSO, ASO and ALAC (but only as to each organization's own appointments), plus the unsolved case of the NomCom.  The "Who Can Initiate A Petition" and "Things Required to Initiate" sections seems particularly off-target.

Some of the slides have decision thresholds to "approve," while others have thresholds to "reject," making them confusing -- this is particularly true of the Bylaw and Fundamental Bylaw slides.  These rights appear to work in opposite ways -- Bylaws will be changed unless 75% vote to reject, while Fundamental Bylaws will not be changed unless 83% vote to accept.  Maybe this is what we intended, but it looks odd when expressed this way.

On Slide 1, the title refers to "Strategy Operating Plans" -- obviously there is no such thing.  ICANN has a Strategic Plan updated every 5 years, a 5 Year Operating Plan updated annually, and an annual Operating Plan and Budget derived from the 5 Year Operating Plan.  These should be referred to accurately.

Greg

On Sat, May 2, 2015 at 9:10 PM, Gregory, Holly <holly.gregory at sidley.com<mailto:holly.gregory at sidley.com>> wrote:
Hi Adam, perhaps we should plan on a quick call for the Legal Subteam to clarify to us what the intent is. We found the draft proposal and the slides somewhat confused in the earlier draft and tried to clarify but apparently without success.

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________________________________
From: Rosemary E. Fei
Sent: Saturday, May 02, 2015 06:33:03 PM
To: 'Adam Peake'; Gregory, Holly; Hofheimer, Joshua T.
Cc: Leon Sanchez; Greg Shatan; Sidley ICANN CCWG; ICANN-Adler
Subject: RE: XPLANE update - please review
Dear Adam, we will review.

However, I'm not available for the next several hours, and I believe most if not all legal counsel team members are similarly engaged at this point in the weekend, so I'm not sure how quickly this review can be accomplished.

More importantly, I'm unclear what the current member reference model is, since we thought it involved the two groups (a broader community, including both member and non-member groups, and a smaller membership group) described in our prior edits  I'm not sure how to review the slides based on a model I'm not familiar with.  Perhaps there's just a misunderstanding about what the two groups can do, and how the broader community/larger group can influence decisions, as opposed to the rights of the smaller member group.  We sent our revisions to the CCWG Draft Proposal a little while ago which attempted to clarify this, so we hope the concerns will be resolved by that.

Rosemary

-----Original Message-----
From: Adam Peake [mailto:adam.peake at icann.org]
Sent: Saturday, May 02, 2015 4:22 PM
To: Holly Gregory; Rosemary E. Fei; Joshua Hofheimer
Cc: Leon Sanchez; Greg Shatan
Subject: XPLANE update - please review

Dear Rosemary, Holly, Josh:

Attached is an update from XPLANE of the presentation they gave on the
CCWG call last Thursday (IRP not included, they are taking your comments
onboard).

Could you please review in light of the current member reference model,
not the A/B approach of the last memo.  This is urgent please, we lost a
bit of time while XPLANE looked at the approach described in your memo

Leon is having a few email problems at the moment and he's not sure if he
can find a connection robust enough to handle these large PDF files, but
he will send a note as soon as he's able to confirm this request.  I am
also cc¹ing Greg for consistency.

All comments on how the graphics usefully represent the "empowered
community" and the powers and mechanisms much appreciated.  Individual
board removal/board recall is lacking.

Jordan, Thomas and others have proposed a few changes.  These include:

Slide "The Community Mechanism: SO/AC Membership Model" there is no (c) in
how does it work.  The text under "Influence in the Community Mechanism"
change to "the votes come from ICANNs SOs, ACs and the NomCom. Each SO and
AC has a number of votes in the community mechanism, deciding on the
powers established for the community".

Slide power 1 should be "Reconsider/Reject Budget, or Strategic /
Operating Plans"

Slide power 3 (fundamental bylaws) should be 75%.

Slide power 5  (board recall) should show a petition of 3 SO and AC and at
least one of each.  Notion of quorum matters in the sense that every vote
counts.

And a comment on the IRP (but this before you updates on these slides
which are very clear), but they were:  on IRP Slide 7 does the binding
nature need to be modified to mention fiduciary responsibilities?

Leon will write soon.

Best,

Adam

Adam Peake
ICANN

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