[CCWG-ACCT] pending legal questions

[Alan Greenberg]

Not quite Bruce.

I know that for the ALAC, we will have the 
ability to remove whoever we select if they do 
not act in accordance with the ALAC views.

My question is whether the new "rules" can be set 
up so that by nature of a person being named to 
the Chair or "Formal ICANN Honcho (or whatever we 
specify), they can de facto (or with requisite 
paperwork) be the ICANN Member(s).

Alan

At 26/05/2015 01:20 AM, Bruce Tonkin wrote:

>Hello Alan,
>
>I think that individuals can certainly be 
>members and exercise the right of members.
>
>I think you are asking for information on what 
>legal mechanisms can be put in place to ensure 
>that the member exercises they powers under 
>direction of the associated SO/AC, and not of 
>their own volition.   Or put another way – how 
>is the member held accountable to the appointing organization?
>
>Regards,
>Bruce Tonkin
>
>
>From: 
>accountability-cross-community-bounces at icann.org 
>[mailto:accountability-cross-community-bounces at icann.org] 
>On Behalf Of Alan Greenberg
>Sent: Monday, 25 May 2015 11:16 AM
>To: León Felipe Sánchez Ambía; Kavouss Arasteh
>Cc: accountability-cross-community at icann.org
>Subject: Re: [CCWG-ACCT] pending legal questions
>
>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 ¢s 
>structure? What extra accountability would 
>changing jurisdiction bring to the community?
>
>1.  Addressing jurisdiction in articles and 
>bylaws and whether possible under ICANN̢۪s 
>structure:/b>  Under concepts of state corporate 
>law in the US, the entity̢۪s articles of 
>incorporation set forth th 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 “ ininternal affairs 
>doctrine“) .  Thehese 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, theese 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 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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