RE: [council] RE: Draft Motion - GNSO Validation of CCWG-Accountability Budget Request

["Paul McGrady" <policy@xxxxxxxxxxxxxxx>]

Phil, Keith and Ed,

 

Thanks so much for your leadership on this.  I am happy to participate in
that email exchange and think, based on Phil's last email, that we are
already quite close.

 

Best,

Paul

 

 

From: owner-council@xxxxxxxxxxxxxx [mailto:owner-council@xxxxxxxxxxxxxx] On
Behalf Of Phil Corwin
Sent: Friday, September 23, 2016 4:11 PM
To: Drazek, Keith <kdrazek@xxxxxxxxxxxx>
Cc: Paul McGrady <policy@xxxxxxxxxxxxxxx>; James M. Bladel
<jbladel@xxxxxxxxxxx>; GNSO Council List <council@xxxxxxxxxxxxxx>
Subject: RE: [council] RE: Draft Motion - GNSO Validation of
CCWG-Accountability Budget Request

 

Keith:

 

Apologies for the delay in replying but it's been a busy week.

 

Glad that you personally agree with my assessment - and I assure you that I
share the RySG concern about budget creep. So does the BC generally,
although on our BC call yesterday there was some concern that the draft
Resolution takes a somewhat inflexible stand on obtaining additional funding
if it is necessary to complete the work on key issues such as ICANN
transparency.

 

I don't think that in the six days between now and the Council call where
this Resolution will be considered we will have the bandwidth to review all
of the WS2 subgroups, get feedback from the rapporteurs, and guesstimate
which ones are more likely to make valid claims for the use of outside
counsel, much less project what such use might cost. Also, given that there
is a Legal Committee to perform the review function for such outside counsel
requests, it may be inappropriate for Council to interject on which topics
are more deserving of outside legal input.

 

That said, looking at the draft Resolution, I'd posit that 90% of it is
non-controversial and that the part we've been discussing could probably be
made broadly acceptable with some modest wordsmithing to make the points
that:

*         Council expects the working groups to be restrained and judicious
in their use of outside legal assistance, and the Legal Committee to
exercise reasonable and effective controls on such expenditures

*         The aim should be to work within the constraints of the approved
budget, and any additional expenditures beyond it should be approved only
when deemed essential to completing the work (a tough standard but not as
harsh as the "extraordinary circumstances' standard that is in the draft).

*         Council expects that the working groups will receive necessary
support and assistance from ICANN staff.

*          Council believes that revisiting the jurisdiction or organization
of the ICANN legal entity should not be undertaken by the Jurisdiction
subgroup because the new accountability measures are all premised on
California jurisdiction, any near-term changes in organizational
jurisdiction could be extremely destabilizing for ICANN -- and because such
exploration would likely require outside  legal input substantially in
excess of the WS2 budget (this is a nuanced difference from the current
draft, which seems to say that such exploration should be viewed as out of
scope solely for budgetary reasons).

 

What I would propose is that you and I, along with Paul and Ed if they wish
given their input on this (but certainly not excluding any other Councilor
who wishes to be involved) exchange some emails between now and the Council
meeting to see if we can't work up some proposed modifications that would
satisfy everyone's concerns and could be adopted as a friendly amendment on
next week's call. 

 

Is that feasible?

 

Best regards, Philip

 

Philip S. Corwin, Founding Principal

Virtualaw LLC

1155 F Street, NW

Suite 1050

Washington, DC 20004

202-559-8597/Direct

202-559-8750/Fax

202-255-6172/Cell

 

Twitter: @VlawDC

 

"Luck is the residue of design" -- Branch Rickey

 

From: Drazek, Keith [mailto:kdrazek@xxxxxxxxxxxx] 
Sent: Wednesday, September 21, 2016 9:00 PM
To: Phil Corwin
Cc: Paul McGrady; James M. Bladel; GNSO Council List
Subject: Re: [council] RE: Draft Motion - GNSO Validation of
CCWG-Accountability Budget Request

 

Thanks Phil. Speaking personally, I agree generally with your assessment.
That said, the RySG still has significant concerns about the potential for
budget creep. Just thinking out loud...could we make explicit, or carve out,
the very limited and specific areas where we think the WS2 effort needs to
have a bit more flexibility? Regardless, I fully expect the Board would need
to approve any increase to the CCWG WS2 budget. 

 

Regards,

Keith


On Sep 21, 2016, at 12:44 PM, Phil Corwin <psc@xxxxxxxxxxx
<mailto:psc@xxxxxxxxxxx> > wrote:

Keith et al:

 

Thanks for conveying the views of the RySG, and for pointing out some key
exchanges between CEO Marby and members of the Senate Judiciary Committee on
this subject.

 

I think it's important for Council members to disaggregate the question of
availability of funding for independent legal advice to WS2 subgroups from
the question of ICANN's organizational jurisdiction. While the latter
question could require substantial outside legal advice(but probably will
not, as the subgroup does not seem inclined to delve deeply into it), it
should probably not dictate our views on the draft Resolution addressing the
former.

 

The Jurisdiction subgroup met this morning; Paul was on the call, and other
Council members may have been. Almost the entire call was dedicated to
discussing these two questions:

                2. Approach to ICANN's Place of Incorporation and
Headquarters Location 

a. Should the scope of the Jurisdiction topic include examining the effects
of ICANN's place of incorporation and location (for example, on the actual
operation of policies and accountability mechanisms and on the settlement of
disputes), or should this be out of scope?            

b. Should the scope of the Jurisdiction topic include the possibility of
recommending that ICANN be directed to change its place of incorporation
and/or headquarters location, or should this be out of scope?

 

The consensus within the group seemed to favor not using a restricted
version of the subgroup's "scope" to prevent any discussion of the matter -
but to not spend much time on it if it seemed clear that the majority of the
subgroup did not favor any change in ICANN's own jurisdiction, and instead
address such issues as choice of law in ICANN contracts and jurisdictional
matters relevant to ICANN hubs and offices outside the U.S. And it did seem
clear that the majority of the groups' participants do not wish to delve
deeply into and reopen the matter of ICANN's U.S. incorporation. So I think
the prospects of significant sums of outside legal advice being requested on
that are quite low.

 

My own personal view on this ICANN jurisdiction matter is well known, as I
have both written about it and spoke at the Helsinki lightning round --  I
favor memorializing ICANN's U.S. incorporation in a Fundamental Bylaw, as
has already been done for the Empowered Community and the PTI.  But I have
no plans to push that position if the consensus within the subgroup is to
move on to other jurisdictional matters.

 

So any concern I have about the adequacy of the budget for outside legal
support of WS2 subgroups is unrelated to the jurisdiction matter, and is
grounded in my belief that ICANN legal may not be counted on to give fully
comprehensive advice on such matters as transparency/document access, and
staff and Board accountability standards. WS2 issues were put off not
because they are unimportant, but because they were not required to be
resolved in advance of the transition.

 

My understanding of the cost control measures for WS2 are that any
expenditure of funds for outside legal counsel must be considered and
approved by the Legal Committee, and that any request for funding beyond the
$1.4 million being allocated must be approved by that same Legal Committee
and then approved by the Board. Those are tight controls not present in WS1.

 

With that background, and turning to the draft Resolution, I would propose
consideration of:

*         Whether the "extraordinary circumstances" standard proposed in
Resolved clause 3 does not set too high a bar, given the tough cost control
measures already established for WS2 and the inability to foresee where all
of the multiple subgroups may require independent legal advice.

*         Changing the language of Resolved clause 4 to express the
consensus view of Council that ICANN should remain incorporated within the
U.S. (because it's a stable and predictable legal environment; has been
ICANN's jurisdictional locus for two decades; all the accountability
measures have been designed to work within the context of CA law; is
consistent with the incorporation of the EC and PTI; etc.) - rather than
implying that it should not be discussed at all for budgetary reasons --
which seems similar to the "out of scope" position that did not have
significant backing with the subgroup, even though the consensus within the
subgroup seems to be to leave U.S. incorporation in place and move on to
secondary jurisdiction matters once we have had some discussion. 

If changes are made to resolved Clause 4 then there should probably be some
corresponding changes to Whereas clause 4 as well.

 

I hope those thoughts are useful to other Council members as they consider
this matter.

 

Best to all, Philip

Philip S. Corwin, Founding Principal

Virtualaw LLC

1155 F Street, NW

Suite 1050

Washington, DC 20004

202-559-8597/Direct

202-559-8750/Fax

202-255-6172/Cell

 

Twitter: @VlawDC

 

"Luck is the residue of design" -- Branch Rickey

 

From: Drazek, Keith [mailto:kdrazek@xxxxxxxxxxxx] 
Sent: Wednesday, September 21, 2016 11:23 AM
To: Phil Corwin
Cc: Paul McGrady; James M. Bladel; GNSO Council List
Subject: RE: [council] RE: Draft Motion - GNSO Validation of
CCWG-Accountability Budget Request

 

Further, on the topic of ICANN's jurisdiction, it's probably worth noting
the testimony of Goran Marby before last week's Senate Judiciary hearing
Chaired by Senator Cruz.

 

Here's the link to the hearing webcast:
http://www.judiciary.senate.gov/meetings/protecting-internet-freedom-implica
tions-of-ending-us-oversight-of-the-internet

 

At 1:24:24, Goran responds to questions from Senators Lee, Grassley and Cruz
on ICANN's incorporation, bylaws, headquarters, etc.

 

*         Senator Lee asks, "Is ICANN committed to remain domiciled in the
United States?"  Goran's response is "Yes." He also notes that the basis of
ICANN is built on California law, not to mention its 2000+ contracts.

*         In response to a question from Senator Grassley about ICANN
relocating, Goran says, "It would be very hard to do. It would be easier to
start a new ICANN elsewhere without California law as basis."

*         In response to a question from Senator Cruz, Goran says, "There is
no intention (to relocate ICANN). It would be highly improbable.

 

We should be prudent with both time and money and avoid diving into the
rathole of changing ICANN's jurisdiction or domicile.

 

Regards,

Keith

 

 

From: Drazek, Keith 
Sent: Wednesday, September 21, 2016 5:09 AM
To: Phil Corwin
Cc: Paul McGrady; James M. Bladel; GNSO Council List
Subject: Re: [council] RE: Draft Motion - GNSO Validation of
CCWG-Accountability Budget Request

 

Thanks Phil and Paul for the input. 

 

The RySG has significant concerns about any increase/expansion of the
proposed WS2 budget and would likely oppose language suggesting (a)
reopening discussions on ICANN's  incorporation and/or physical
headquarters, and (b) the need for additional funds to support that effort.
All the reforms we developed in WS1 assume California not-for-profit law and
that simply isn't going to change in WS2. I also do not believe the RySG
would agree to lowering the threshold for additional funds to be solely a
determination of the Legal Committee. 

 

Regards,

Keith


On Sep 20, 2016, at 4:44 PM, Phil Corwin <psc@xxxxxxxxxxx
<mailto:psc@xxxxxxxxxxx> > wrote:

Appreciate the thoughts, Paul.

 

In his role as rapporteur for the Jurisdiction subgroup, Greg Shatan has
circulated thoughts this week on whether and how deeply the Jurisdiction
subgroup should explore the subject of ICANN's organizational jurisdiction,
and that will be the focus of the next subgroup call at 1300 UTC tomorrow.
So its intent in that regard may be clearer within the next 24 hours.

 

Setting aside the jurisdiction issue, I would like to see the GNSO statement
on this express some concern that the amount budgeted for impartial outside
legal assistance may be inadequate, and to endorse  a lower threshold for
making additional funds available if recommended by the Legal Committee -
and certainly not the "extraordinary circumstances" standard proposed in the
current draft. 

 

One thought I have is that the expenditure ceiling might be loosened
somewhat by advocating that up to an additional $700,000 be available to be
allocated (a 50% increase beyond the $1.4M now budgeted) solely upon a
finding by the Legal Committee that such expenditure is justified, with a
higher standard in place for requests that would take spending beyond that.
That might prove a reasonable balance between wanting to assure adequate
resources while  keeping spending under control.

 

Best to all,

Philip

 

Philip S. Corwin, Founding Principal

Virtualaw LLC

1155 F Street, NW

Suite 1050

Washington, DC 20004

202-559-8597/Direct

202-559-8750/Fax

202-255-6172/Cell

 

Twitter: @VlawDC

 

"Luck is the residue of design" -- Branch Rickey

 

From: Paul McGrady [mailto:policy@xxxxxxxxxxxxxxx] 
Sent: Tuesday, September 20, 2016 4:34 PM
To: Phil Corwin; 'James M. Bladel'; 'GNSO Council List'
Subject: RE: [council] RE: Draft Motion - GNSO Validation of
CCWG-Accountability Budget Request

 

Thanks Phil.  I'll need to run this past the IPC of course, but my initial
thoughts are:

 

I guess I read James' rather artful language as a means of pointing out the
lack of adequate funding rather than an instruction that WS2 shouldn't look
at the formation jurisdiction issue.  Perhaps we can strengthen the language
a bit to make that clear.  How about:

 

"It is the position of the GNSO Council that any choice by WS2 participants
to revisit the formation jurisdiction or nature of organization of the ICANN
legal entity, as established by CCWG-Accountability Work Stream 1, namely
California, would not be adequately supported by this projected budget as
any change in formation jurisdiction or nature of organization of the ICANN
legal entity would necessarily lead to undoing much of the work of
Workstream 1.  In the event that WS@ participants open up this topic,
additional funding for legal advice will become necessary."

 

Does that work?

 

In a related thought, I'm of the opposite view that formation jurisdiction
or nature of organization of the ICANN legal entity should not be reopened
in WS2 as it is not inevitable that it turn out the way you hope, with a
fundamental bylaw making California permanent (or as permanent as possible).


 

Best,

Paul

 

 

From: owner-council@xxxxxxxxxxxxxx <mailto:owner-council@xxxxxxxxxxxxxx>
[mailto:owner-council@xxxxxxxxxxxxxx] On Behalf Of Phil Corwin
Sent: Monday, September 19, 2016 5:40 PM
To: James M. Bladel <jbladel@xxxxxxxxxxx <mailto:jbladel@xxxxxxxxxxx> >;
GNSO Council List <council@xxxxxxxxxxxxxx <mailto:council@xxxxxxxxxxxxxx> >
Subject: [council] RE: Draft Motion - GNSO Validation of CCWG-Accountability
Budget Request
Importance: High

 

James:

 

The following remarks are my personal views, and I will share them with the
BC Executive Committee and BC members prior to our September 29th meeting to
assure that any statement I make/position I take at that meeting is
consistent with the consensus within the BC.

 

That said, I have some significant concerns about the wording of the draft
Resolution, and shall now set them forth.

 

Use of Budget Constraints to limit range of discussion within WGs_-

 

Your cover note states, "I would like to draw your attention to WHEREAS #4
and RESOLVED #4, in which I attempted to capture the concerns raised by Phil
and Paul and others regarding revisiting the subject of ICANN Jurisdiction
in WS2". My comments on this draft resolution are solely my own and I will
let Paul chime in, or not, as he sees fit.

 

Whereas #4 states --  "The GNSO Council notes that many members of the GNSO
community have expressed the view that the projected budget does not support
revisiting the topic of the jurisdiction of ICANN"s organization."

 

Resolved #4 states - "It is the position of the GNSO Council that revisiting
the jurisdiction or organization of the ICANN legal entity, as established
by CCWG-Accountability Work Stream 1, is not supported by this projected
budget."

 

My very public personal position on ICANN's organizational jurisdiction is
that it was a mistake not to resolve this matter during WS1 (and the failure
to do so is now being cited by Congressional critics of the IANA
Transition), and that ICANN's U.S. incorporation should be enshrined in a
Fundamental Bylaw as an expedited outcome of WS2.

 

Notwithstanding that clear personal view, I have concerns about the proposed
language cited above. For one thing, it is presently ambiguous - it is not
clear whether the import of the language is that:

*         The projected budget should be increased so that "the topic of the
jurisdiction of ICANN"s organization" can be revisited or addressed (the
word "revisited" is also problematic, as it implies that some conclusive
decision was made on this matter during WS2, whereas the record is to the
contrary), or

*         The topic of organizational jurisdiction should be off-limits in
WS2 due to budget constraints

 

Again, my personal view is that this topic of ICANN's organizational
jurisdiction should be further addressed in WS2 - and should be definitively
resolved through the adoption of a Fundamental Bylaw enshrining US
incorporation.

 

Notwithstanding that personal view, I am opposed to any Resolution which
takes the position that budget considerations should limit the scope of
inquiry and discussion of any WS2 subgroup. The budget, and especially that
for impartial outside legal expertise on accountability matters on which
ICANN Legal may have an inherent bias (such as transparency or staff
accountability) should be adequate to support the necessary work, rather
than suggesting that the work should be constrained to fit within the scope
of the budget.

 

Adequacy of the budget for outside legal expertise

 

The other problem I have with the draft Resolution is that it does not speak
at all to the general concerns I and others have expressed about the
adequacy of the budget for outside legal expertise for WS2 activities, as
well as the proposed process for obtaining authorization of additional
funding. 

 

My recollection is that the WS2 legal budget is just one-tenth of the
amounts expended for WS1 -- $1.4M compared to $14M. I would certainly
anticipate that WS2 outside legal expenses will be substantially less than
in WS1 because major revisions and drafting of Bylaws and Articles of
Incorporation will not be required. Yet there is still reason to believe
that a 90% reduction is excessively severe and likely to fall short of
requirements for a quality and fully considered work product.

 

It is also my recollection that under the proposed budget and accompanying
procedures, even if the Legal Committee agrees that additional funding is
required at some point in the process, the Board has unbridled discretion
and decisional authority to accept, reject, or modify such a request for
additional funds. This is very troubling given that WS2 addresses such
matters as organizational transparency, and Board and staff accountability. 

 

Therefore, at this time I cannot personally support the proposed language in
Resolved clause #3 - "The GNSO Council expects the CCWG-Accountability and
staff to work within the constraints of this approved budget, and that
excess costs or request for additional funding will be considered only in
extraordinary circumstances." (Emphasis added)

 

An "extraordinary circumstances" standard for authorizing additional funds
is, in my opinion, far too high given that the budget for WS2 was set by a
small group and only put out for public reaction after the fact. Further, it
is absolutely unacceptance as a standard for consideration of additional
funding requests - every such request should be considered without bias on
its own separate merits, and not face a high hurdle simply because it
exceeds a legal assistance budget that some Council and community members
already fear may be inadequate to support the necessary work delegated to
WS2. 

 

Summing up, my personal view is that this Resolution should be modified to:

1.       Eliminate any suggestion that discussion of ICANN's organizational
locus of incorporation is off-limits for the Jurisdiction subgroup based
upon budget considerations

2.       Express general concern about the adequacy of the funds budgeted
for outside legal assistance, as well as the proposed process for deciding
whether additional funds should be allocated at a future point of time.

 

I thank you and my fellow Councilors for considering these views, and look
forward to further discussion of this matter.

 

Regards, Philip

 

 

 

Philip S. Corwin, Founding Principal

Virtualaw LLC

1155 F Street, NW

Suite 1050

Washington, DC 20004

202-559-8597/Direct

202-559-8750/Fax

202-255-6172/Cell

 

Twitter: @VlawDC

 

"Luck is the residue of design" -- Branch Rickey

 

From: owner-council@xxxxxxxxxxxxxx <mailto:owner-council@xxxxxxxxxxxxxx>
[mailto:owner-council@xxxxxxxxxxxxxx] On Behalf Of James M. Bladel
Sent: Monday, September 19, 2016 4:02 PM
To: GNSO Council List
Subject: [council] Draft Motion - GNSO Validation of CCWG-Accountability
Budget Request

 

Council Colleagues - 

 

Attached and copied below, please find a draft motion for consideration
during our next GNSO Council call (29 SEP), that examines the subject of the
proposed budget & cost control mechanisms for CCWG-ACCT and Work Stream 2.


 

In particular, I would like to draw your attention to WHEREAS #4 and
RESOLVED #4, in which I attempted to capture the concerns raised by Phil and
Paul and others regarding revisiting the subject of ICANN Jurisdiction in
WS2.  Please review these provisions closely, and make sure that they
accurately reflect these points.

 

Thank you,

 

J.

 

 

 

Draft Motion - GNSO Validation of CCWG-Accountability Budget Request

 

WHEREAS, 

 

1.      Per its Charter, the Project Cost Support Team (PCST) has supported
the CCWG-Accountability in developing a draft budget and cost-control
processes for the CCWG-Accountability activities for FY17, and has also
developed a historical analysis of all the transition costs to date (see
https://gnso.icann.org/mailing-lists/archives/council/pdfpklU5q6Ojg.pdf).

 

2.      The CCWG-Accountability FY17 budget was presented at its plenary
meeting of June 21st and approved for transmission to the Chartering
Organizations for validation as per the process agreed with the PCST. This
request for validation was received on 23 June.

 

3.      Following review and discussion during ICANN56, the GNSO Council
requested
<https://gnso.icann.org/en/correspondence/bladel-to-bfc-ccwg-accountability-
chairs-10jul16-en.pdf>  a webinar on this topic which was held on 23 August
(see transcript at
https://gnso.icann.org/en/meetings/transcript-ccwg-accountability-webinar-23
aug16-en.pdf, recording at
http://audio.icann.org/gnso/gnso-ccwg-accountability-webinar-23aug16-en.mp3
and AC recording at https://icann.adobeconnect.com/p8fu99qpt7d/).  

 

4.      The GNSO Council notes that many members of the GNSO community have
expressed the view that the projected budget does not support revisiting the
topic of the jurisdiction of ICANN"s organization.

 

5.      The GNSO Council has discussed and reviewed all the relevant
materials. 

 

RESOLVED,

 

1.      The GNSO Council hereby accepts the proposed CCWG-Accountability
FY17 budget, as well as the cost-control processes presented in conjunction
with the CCWG budget (see
https://gnso.icann.org/mailing-lists/archives/council/pdfpklU5q6Ojg.pdf). 

 

2.      The GNSO Council expects to receive regular updates on actual
expenditures as tracked against this adopted budget, and reserves the right
to provide further input on the budget allocation in relation to the
CCWG-Accountability related activities.

 

3.      The GNSO Council expects the CCWG-Accountability and staff to work
within the constraints of this approved budget, and that excess costs or
request for additional funding will be considered only in extraordinary
circumstances. 

 

4.      It is the position of the GNSO Council that revisiting the
jurisdiction or organization of the ICANN legal entity, as established by
CCWG-Accountability Work Stream 1, is not supported by this projected
budget.

 

5.      The GNSO Council requests the GNSO Secretariat to communicate this
resolution to the CCWG-Accountability Chairs, and to the office of the ICANN
CFO.     

 

 


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