[CCWG-ACCT] pending legal questions

Alan Greenberg alan.greenberg at mcgill.ca
Mon May 25 01:15:46 UTC 2015 

Leon, at least from my point of view, I think the 
question is a bit more specific. We of course 
know that individuals have a legal persona and 
therefore could be Members (or Designators).

The question is whether it is practical to 
structure things so that the SO/AC Chairs (or 
other individuals named by their office within 
the ICANN community (perhaps a Chair of a SG in 
the case of the GNSO) can be identified as 
Members and whoever the incumbent is in the 
office plays that role. Or if that is not 
possible, is there an easy easy to 
designate  them (no pun intended) as Designators 
or Members when they assume office. And if some 
peron is playing that role, can they appoint 
someone else to act in that capacity in place of them.

Alan

At 24/05/2015 08:56 PM, León Felipe Sánchez Ambía wrote:
>Dear Kavouss,
>
>Thanks for your questions. At this stage, the 
>advice from lawyers is that membership approach 
>can be implementable in many ways. One being the 
>establishment of UA but also any other kind of 
>legal vehicle. The example mentioned has been a 
>non-profit organization. I stress that this has 
>just been used as an example and no one has 
>suggested this approach as it has only been used 
>to illustrate which other legal vehicles could be used to become a member.
>
>The bottom line is that to exercise certain 
>powers as Board member removal and budget 
>approval, there would be the need to have a 
>legal vehicle (whatever legal vehicle) to implement the proposal.
>
>I hope you find this information useful. Please 
>let me know if you need further clarification.
>
>
>Best regards,
>
>
>León
>
>>El 24/05/2015, a las 2:29, Kavouss Arasteh 
>><<mailto:kavouss.arasteh at gmail.com>kavouss.arasteh at gmail.com> escribió:
>>
>>Dear Leon
>>I have  asked few questions for which no reply are yet provided?!
>>Now , since last week , extensive discussions 
>>are on going on whether a membership approach 
>>is implementable without a need to UA?
>>May you raise this issue to the legal council pls
>>Regards
>>Kavouss
>>
>>
>>Sent from my iPhone
>>
>>On 24 May 2015, at 02:21, León Felipe Sánchez 
>>Ambía <<mailto:leonfelipe at sanchez.mx>leonfelipe at sanchez.mx> wrote:
>>
>>>Dear Jorge,
>>>
>>>Apologies for the delayed reply. On April 1st, 
>>>Sidley answered these questions on the Lega 
>>>Sub-team list. I apologize for having missed 
>>>them and not forwarding them to you.
>>>
>>>I hope you find this information useful.
>>>
>>>
>>>A.  Jurisdiction:   What provisions, if any, 
>>>can be included in the Bylaws or articles of 
>>>incorporation related to jurisdiction issues? 
>>>Is that possible under current ICANN’s 
>>>structure? What extra accountability would 
>>>changing jurisdiction bring to the community?
>>>
>>>1.  Addressing jurisdiction in articles and 
>>>bylaws and whether possible under ICANN’s 
>>>structure:  Under concepts of state corporate 
>>>law in the US, the entity’s articles of 
>>>incorporation set forth the jurisdiction under 
>>>which a corporation is formed .  The laws of 
>>>the jurisdiction of formation (currently for 
>>>ICANN, California) govern the internal affairs 
>>>of the corporation (the “ internal affairs 
>>>doctrine“) .  These internal affairs include 
>>>issues that one would expect to see expressed 
>>>in bylaws such as  how the entity is organized 
>>>internally and the various roles and decision 
>>>rights and responsibilities of key 
>>>participants:  members or designators (if 
>>>any), directors and officers, and other key 
>>>constituents.   Generally the corporation has 
>>>to have s a "registered office"  in the state 
>>>of incorporation but it may have its primary 
>>>office in another jurisdiction.   There is 
>>>also flexibility to provide for alternate 
>>>dispute resolutions and to designate specific 
>>>choice of law provisions for such dispute 
>>>resolution.  For example,   the bylaws can set 
>>>up alternative dispute resolution processes 
>>>subject to binding international arbitration 
>>>that follows bespoke rules formulated and 
>>>agreed to by the community in the bylaws and 
>>>other core documents.  Although this does not 
>>>fully allow the community to establish a 
>>>comprehensive and binding private 
>>>international law, and some court challenges 
>>>will remain possible for entities organized 
>>>under the laws of any jurisdiction, this would 
>>>allow for the resolution of most disputes in a 
>>>manner consistent with the legal norms of the 
>>>multi-stakeholder community, as has long been 
>>>the case with respect to domain name 
>>>disputes.  Outside of bylaw provisions, 
>>>contracting parties typically specify what law 
>>>shall govern specific contractual arrangements 
>>>and  provide forspecific mechanisms to apply 
>>>for dispute resolution.  For example CA law 
>>>need not be the law chosen to rule a 
>>>particular contractual relation.  And 
>>>contracts with third parties can define 
>>>alternate jurisdictions and mechanisms to resolve legal disagreements.
>>>
>>>To the extent that this question is intended 
>>>to relate to  establishing a commitment to 
>>>review where ICANN should be incorporated in 
>>>the future, we need more information about 
>>>what is sought to be accomplished  and the 
>>>opportunity to undertake specific research.
>>>
>>>To the extent that this question is about 
>>>locking in a jurisdiction  for formation or 
>>>for dispute resolution or other purposes such 
>>>that it is very difficult to change in the 
>>>future, we would need to undertake research 
>>>and also explore the pros and cons of such an 
>>>approach and how it might be effectuated for 
>>>example through a very high threshold for amendment or golden bylaw.
>>>
>>>2.   Extra accountability mechanisms in other 
>>>jurisdictions:  As to  whether extra 
>>>accountability mechanisms  are available in 
>>>other jurisdictions, we would have to engage 
>>>in research  and it would be helpful to have 
>>>direction as to several jurisdictions of 
>>>interest rather than canvas the entire set of 
>>>possibilities.  We are not aware without 
>>>further research of a jurisdiction that offers 
>>>extra accountability mechanisms that could not 
>>>be created in the flexible framework provided 
>>>by state corporate law in the US Before 
>>>we  undertake research on this question it 
>>>would be helpful to better understand the 
>>>underlying concern that is driving this question.
>>>
>>>B.  Liability: Which would be the liability of 
>>>those persons conforming the proposed bodies? 
>>>(IRP, Supervisory Board) Has the figure of a 
>>>supervisory board has been put in practice in California?
>>>
>>>1.  Liability of persons participating on 
>>>proposed bodies:   While directors and 
>>>officers of a corporation take on certain 
>>>responsibilities and liabilities as 
>>>fiduciaries, it is relatively rare for a 
>>>director or officer of a non-profit 
>>>corporation to be found liable for breach of 
>>>duty absent malfeasance – for exxample 
>>>engaging in self-dealing.  In addition, the 
>>>corporation generally can exculpate (hold 
>>>harmless) and indemnify (promise to pay for a 
>>>financial liability outcome) so long as the 
>>>act was not criminal or a breach of the duty 
>>>of loyalty (self-dealing) or otherwise in bad 
>>>faith.  As to other persons – for examples 
>>>members of a review panel, these same 
>>>prootections of exculpation and 
>>>indemnification are available.  Generally 
>>>there are a variety of protections available 
>>>to help protect persons involved in ICANN 
>>>governance from personal liability.
>>>
>>>2.  Supervisory boards:   A two tier board 
>>>structure – with of a supervisoory board and a 
>>>management board is generally not a specific 
>>>legal construct under state corporate law in 
>>>the US.  State corporate law generally 
>>>contemplates that the board of directors has 
>>>authority to manage and direct the affairs of 
>>>the corporation and that the board typically 
>>>delegates management functions to a group of 
>>>officers.  Those officers are not typically 
>>>organized into a “managing board” (but 
>>>this may be a difference without much specific 
>>>legal import).   Additionally, a board can 
>>>delegate to a  board committee in ways that 
>>>can mimic some aspects of the distinction 
>>>between a supervisory board and a management 
>>>board , although if that board committee takes 
>>>on management tasks there is some risk that 
>>>its members could be viewed to take on the 
>>>heightened legal responsibilities and 
>>>liabilities associated with corporate officers.
>>>Best regards,
>>>
>>>
>>>León
>>>
>>>>El 23/05/2015, a las 1:22, 
>>>><mailto:Jorge.Cancio at bakom.admin.ch>Jorge.Cancio at bakom.admin.ch escribió:
>>>>
>>>>Dear Co-Chairs, dear all
>>>>
>>>>
>>>>I would like to kindly request information on 
>>>>the status of processing the following legal 
>>>>questions, as I was informed more than a 
>>>>month ago that an answer was being prepared, 
>>>>but still I have not seen any specific reply.
>>>>
>>>>All questions were refered to and posed during the CCWG call of March 31st:
>>>>
>>>>==
>>>>
>>>>- On jurisdiction I'd like to remind that 
>>>>there is a question which as I understand 
>>>>will be posed to our legal advisors on common 
>>>>practice regarding provisions included 
>>>>usually, if any, on jurisdiction issues in 
>>>>Bylaws and Articles of Incorporation (and the 
>>>>current situation in the case of ICANN)?
>>>>
>>>>-  question of possible liabilities of future 
>>>>"community council" members -for exercising 
>>>>its powers- has been or will be considered. A 
>>>>question which arises from the paper is that 
>>>>the more power you give to actors different 
>>>>to the board, the more it is likely that they 
>>>>become liable in some fashion - this should be further investigated.
>>>>
>>>>- it seems in both papers (Sidley and Adler) 
>>>>that there would be some difficulties in 
>>>>finding solutions for independent and binding 
>>>>appeals panels - I guess this will need to be explored in depth
>>>>
>>>>==
>>>>
>>>>The references to legal memos in those 
>>>>questions should be understood as refering to the papers current on March 31st.
>>>>
>>>>Thank you very much for your assistance and best regards
>>>>
>>>>
>>>>
>>>>Jorge Cancio
>>>>Switzerland
>>>>
>>>>Von meinem iPhone gesendet
>>>
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