GROUP C: MEMBERS RIGHTS AND RESPONSIBILITIES
Mr Provance: I would suppose this report is a bit like following Bob Hope. I'm Michael Provance with U.S. Interactive. And I'm reporting on the discussion that Group C had on the topic of member rights and liabilities. So we started with the premise that all members had no rights and all the liability, but that didn't work out too well, so in actuality we approached it pretty methodically. First we started off by defining just who are we talking about in terms of members. And on the right side of that we identified three classes of members, the Board of Director members, the members of the corporation or entity that exists, and then the members of the entire Internet community that are somehow impacted by decisions made at the entity level.
On the liability side we added a fourth class of member which were staff that may be hired as part of this corporation to handle operations. We also had to clarify a couple of other definitions so that we, as we started to talk about rights and liabilities, we're handling all of the stakeholders interests in these discussions and those were the registrars and the registries. And we defined the register as simply those who assign domain names and the registry simply as those who handle a central database for top level domain.
From there we went onto all the different things we agreed on.
But before we got into the rights and liabilities, we thought it prudent to try to estimate what Groups A and B were going to talk about in terms of responsibilities for this corporation. So I just want to hit the bullet points of what we said the responsibilities were for the different classes of members as a framework for talking about their rights and liabilities.
First oft we identified that the corporations responsibility was primarily for addressing compelling security and stability issues that impact the Internet as a whole and kept it at that type of high level responsibility. Secondly we said the Board of Directors of that corporation have fiduciary responsibility to the entire Internet community by serving as Board of Directors of that corporation. We also said that one of the responsibilities for this entity was the operation and maintenance of the route server and any entries, changes, and deletions from that route server. However, the actual day-to-day operation of that process could be delegated to a group or groups who would actually take care of throwing the switches. We said that they were also responsible for 'p number allocation, but they could also delegate the day-to-day operations of tat task as well.
And finally, we felt that the entity and the Board of Directors must have oversight control of the registries, but that they must not have oversight control of the registrars. We felt that the corporation and through the Board of Directors should develop policies determining the minimum technical requirements including equipment, bandwidth, staff; and other similar items for the registries to ensure stability. However, we disagreed on enforcing any type of financial requirements on the registries.
So with that set of responsibilities in hand we talked about rights. The first fight we came to very quickly is that all of the members, whether they are on the Board of Directors in the entity or part of the Internet community, would have a right to open records of significant issues before the Board and would have reasonable time to respond to those issue prior to any decision being made at the Board level. However, we disagreed on the definition of what significant policy issues were and who would decide what those significant issues are. So there are clearly some open issues there.
We also said that the right to vote on different issues had to be structured in a couple of different levels, that of simple majority and super majority. We thought that simple majority votes could handle all the day-to-day types of decisions that would go on. But other tougher decisions would require a super majority. And again in this case we couldn't decide on the definition of what tougher was, so that's another open issue.
We thought in terms of super majority decisions that would require at a minimum a super majority decision of the Board and possibly a vote of the entire membership of this corporation to change the structure of that corporation, to change the size of the Board, and to change the basic by-laws of that corporation.
We also said that there were certain rights conferred on the registries and the registrars and that was that the entity would not, this entity, the corporation would not mandate protocols on the interactions between registries and registrars. The reason for that is that is essentially a business issue and we felt that the Board should, or the corporation and the Board should stay as far away from making marketplace and business issue decisions as it could and stick to issues about security and stability.
On the liability side one quickly jumped into our minds when we started this discussion and that was that the Board of Directors and potentially and also, well, the Board of Directors should have D&O insurance as part of this corporation. And we also felt that the staff should be indemnified from the membership and registries and registrars and everyone else that would be impacted by decisions of this corporation.
The second liability that we identified that is that no one or that the corporation would not indemnify registrars. And that is simply because that's a marketplace issue m how registrars rim their business, and since they would not have direct accountability to this corporation, the corporation did not want to be liable for their marketplace decisions.
Second liability was that because the entity has, the corporation has a closer relationship with each registry and makes rules and policies that directly affect those registries, that it would indemnify registries and potentially assist in the defense of those registries, if the registries acted in accordance with the policies and found themselves in some type of litigation. So if as a result of something that corporation did through it's policies, a registry found itself fighting a battle, the corporations responsibility was to step in and assist them, and that was a liability for the corporation.
Those were, that's the extent of the rights and liabilities we could identify. I'm sure there is a whole host of other ones that we didn't but I'd be happy to take any questions on those.
MALE SPEAKER: Sure. I don't know if the issue came up in your group, but if it did I'd like hear about it. To what degree did you consider the fact that being so open may lead to organizational stases, we can't get any work done?
Mr Provance: We considered that and that was one of the reasons why we chose to limit the responsibility of the corporation to issues of compelling security and stability and stay away from what would tend to be a more amorphous business issues tat, you know, could potentially clog the wheels of the corporation.
MALE SPEAKER: So tat openness has been moved down to the various councils or-Mr Provance: We basically pushed it as far down as we could, essentially a number of us, and I'm speaking, you know, basically, for myself and just comments that were made, we all disagreed on a lot of things, there were a number of free market people there, we thought it should be pushed all the way to the marketplace. There were a number of people that thought it should be only pushed down to the council level. But we all seemed to, and anyone from Group C please cut me off if I'm mis-speaking, but we all seemed to feel that the more we could push those types of decisions that would clog the wheels out of the corporations purview if it didn't address compelling security and stability issues, that was preferable to trying to centralize everything.
MALE SPEAKER: So an acceptable result in those situations would be no action at all, no decision, ~ Mr Provance: No that wouldn't be an acceptable action, but we would expect to have a corporation that has policies that are very specific in certain areas and let the marketplace take care of issues that are truly marketplace issues, and in the gray area which corporations deal with every day, there would have to be exceptions to the rule, and there would be procedures for handling those exceptions. And we did talk about potential ways to do that, but we did not agree on any particular way to handle that.
MALE SPEAKER: Okay.
Mr Fenello: Jay Fenello with Iperdome. One of the questions that came up in Group B was about the membership of the Board and whether they represented themselves personally or the organizations who may be they were affiliate with. And secondarily if the organizations that they were affiliated with weren't happy with their performance and they were terminated, what impact that would have on their role and the Board?
Mr Provance: Well one of them should have listed the things that we disagreed on. There were four really big things we disagreed on, the first of which addresses your questions. We could not agree on the removal, on who was able to remove directors and what process they would have to go through to remove the directors. So we tabled that and said that was, you know, some other letter of the alphabet to deal with.
We also disagreed on trademark infringement and pretty quickly tabled that. And who would handle generic top level domain allocation, we tabled that, and also dispute resolution was quickly tabled. Any other questions? Thanks.
Closing Remarks: Dr Tamar Frankel
Dr. Frankel: Thank you very much. If I had hoped for a meeting, I think that hope was realized. I think you sat, you talked, you exchanged ideas and came up with something and this is a wonderful start. I thank you all and I hope to see you tomorrow to continue the same process.
I've been asked to make an announcement that there will be a short briefing for the journalists who are in the audience and they could meet at the front of the rooni, please. So see you tomorrow, and see you tonight at the reception. Thank you again.