[Gnso-newgtld-wg] proposed Language for those Getting Applicant Support

Tue Jun 9 12:52:45 UTC 2020

Sorry to be late to the party on this one.  I echo Mike’s concerns that 5 years is a long time. Additionally, I am concerned with the use of “legitimate”.  I understand the intent and the examples are helpful, but words like “legitimate” are almost certain to be disputed later.  Also, there is no exchange that would involve financial gain (another term open to interpretation) which could be “legitimate”?  And what about situations where the registry will otherwise fail if the RO does not sell?  The RO should instead fail and the TLD should go through the ICANN process – this is a better outcome?  I am also concerned with giving ICANN the ability to “reasonably” withhold its consent to an assignment.  ICANN does not always act reasonably and when ICANN even arguably has discretion to make decisions things don’t always turn out so well…

Marc H. Trachtenberg
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[Greenberg Traurig]

From: Gnso-newgtld-wg [mailto:gnso-newgtld-wg-bounces at icann.org] On Behalf Of Jeff Neuman
Sent: Tuesday, June 9, 2020 7:40 AM
To: Aikman-Scalese, Anne <AAikman at lrrc.com>; Mike Rodenbaugh <mike at rodenbaugh.com>
Cc: gnso-newgtld-wg at icann.org
Subject: Re: [Gnso-newgtld-wg] proposed Language for those Getting Applicant Support

*EXTERNAL TO GT*
Thanks Anne, you are correct that the However, sentence is not complete.  So, please find the rest of the sentence:

“If the Applicant getting Applicant Support prevails in an auction, there should be restrictions placed on the Applicant from assigning the Registry Agreement, and/or from any Change of Control for a period of no less than five (5) years.  This restriction is in place to prevent gaming of the applicant support program whereby an applicant immediately transfers its ownership of a registry to a third party in exchange for any form of financial gain.  However, legitimate assignments (e.g., changing of ownership due to death or retirement, etc., assignments to subsidiaries, etc.) shall be permitted.  All assignments must have ICANN's consent, which consent may be reasonably withheld. In the event of a change of control after the first five (5) years but during the remaining first term of the registry agreement, the applicant should be required to repay the financial support that they received.”

Jeff Neuman
Senior Vice President
Com Laude | Valideus
D: +1.703.635.7514
E: jeff.neuman at comlaude.com<mailto:jeff.neuman at comlaude.com>

From: Aikman-Scalese, Anne <AAikman at lrrc.com<mailto:AAikman at lrrc.com>>
Sent: Monday, June 8, 2020 3:17 PM
To: Mike Rodenbaugh <mike at rodenbaugh.com<mailto:mike at rodenbaugh.com>>; Jeff Neuman <jeff.neuman at comlaude.com<mailto:jeff.neuman at comlaude.com>>
Cc: gnso-newgtld-wg at icann.org<mailto:gnso-newgtld-wg at icann.org>
Subject: RE: [Gnso-newgtld-wg] proposed Language for those Getting Applicant Support

I like the five years.
The sentence that begins with “However” does not appear to be a complete sentence.

Why are we limiting the reimbursement provision to the second half of the contract?
Thanks,
Anne

From: Gnso-newgtld-wg <gnso-newgtld-wg-bounces at icann.org<mailto:gnso-newgtld-wg-bounces at icann.org>> On Behalf Of Mike Rodenbaugh
Sent: Monday, June 8, 2020 12:10 PM
To: Jeff Neuman <jeff.neuman at comlaude.com<mailto:jeff.neuman at comlaude.com>>
Cc: gnso-newgtld-wg at icann.org<mailto:gnso-newgtld-wg at icann.org>
Subject: Re: [Gnso-newgtld-wg] proposed Language for those Getting Applicant Support

[EXTERNAL]
________________________________
Five years seems like an eternity.  How about two or three, instead?

[Logo]

Mike Rodenbaugh

address:

548 Market Street, Box 55819

San Francisco, CA 94104

email:

mike at rodenbaugh.com<mailto:mike at rodenbaugh.com>

phone:

+1 (415) 738-8087

On Mon, Jun 8, 2020 at 11:43 AM Jeff Neuman <jeff.neuman at comlaude.com<mailto:jeff.neuman at comlaude.com>> wrote:
All,

On the call today, Susan raised a good point about applicants that get Applicant Support trying to “game the system” by immediately flipping their registries to a third party to make a profit.  Although we would hope that those that take the time to go through the Applicant Support Program (ASP) and get approved would alone demonstrate that this is unlikely to happen.  The process to get support is supposed to be vigorous and try to root out potential gaming.  That said, I worked with Susan to draft the following language.  Would this be acceptable as a Recommendation?

“If the Applicant getting Applicant Support prevails in an auction, there should be restrictions placed on the Applicant from assigning the Registry Agreement, and/or from any Change of Control for a period of no less than five (5) years.  This restriction is in place to prevent gaming of the applicant support program whereby an applicant immediately transfers its ownership of a registry to a third party in exchange for any form of financial gain.  However, legitimate assignments (e.g., changing of ownership due to death or retirement, etc., assignments to subsidiaries, etc.).  All assignments must have ICANN's consent, which consent may be reasonably withheld. In the event of a change of control after the first five (5) years but during the remaining first term of the registry agreement, the applicant should be required to repay the financial support that they received.”

Note:  We would add this to Agreements for all that get Applicant Support, not just those that prevail at an auction (with the multiplier or other form of bid credit).

Discuss………..

Jeff Neuman
Senior Vice President

Com Laude | Valideus
1751 Pinnacle Drive
Suite 600, McLean
VA 22102, USA

M: +1.202.549.5079
D: +1.703.635.7514
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