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<p>One of the things that has long concerned me about ICANN is that
the method of filling board seats tends to create a board of
directors that is more a board of passive worthies who may not
fully understand their duties and who tend to not fully understand
their powers. The result is, as we have seen, an imbalance in
which the board of directors largely sits and watches while the
hired executives and an ever expanding staff run roughshod and
unrestrained.</p>
<p>I am not aware of the current arrangement, but many of ICANN's
Presidents (that is the word used in the bylaws, "president" of
which CEO is merely one of his/her tasks) is not hired directly
but, rather is linked to ICANN by a contract with a professional
services corporation that markets the person to ICANN via a
contract with that corporation, that in turn, is the employer of
that person. This is a really weird arrangement because it
substantially muddies the legal relationship between ICANN, that
professional services corporation, and the person with the title
"President". I always thought that this was an ill advised
practice that ought to have been avoided in the past and ought not
be used in the future.<br>
</p>
<p>ICANN's President is a hireling, not a king.<br>
</p>
<p>ICANN's board *does* have the ability and power and right to
remove any officer, including the President, at any time. That
means plucking that person out of his/her box on the org chart or
redefining the duties and title of any box on that org chart.</p>
<p>Now, that does mean that the employment contract is voided and
that ICANN and the former officer simply part ways.</p>
<p>One of the definitions of a contract is that it is an agreement
over how much it will cost to *not* do what you promised to do.
And a principal of American law (and the law of many other places)
is that civil matters can usually be compensated with the payment
of money. (Note that I used the word "compensated". Punitive
remedies not related to actual harms and losses are usually
frowned upon.)<br>
</p>
<p>So if ICANN's board says "bye bye" to a President, or
substantially changes his/her duties (such as eliminating the
ex-officio seat on the board) then that President can claim that
the employment contract was breached and that he/she is owned
compensation. That compensation is usually established by the
contract as liquidated damages (i.e. money) or is computed and
converted into a monetary amount. (California law generally
frowns on "penalty" amounts that are not tied to actual loss of
contractual benefits.) Only rarely are breached contract
provisions remedied through what is called "specific performance",
such as an order to transfer a specific house or a specific
painting rather than paying money damages. It is likely that
changing ICANN's President's employment status or duties would be
insufficient grounds for a court to order specific performance to
keep the President in the prior status and role.<br>
</p>
<p>So, if ICANN removes its President or changes his/her duties,
ICANN may have a lingering obligation to pay salary and benefits
to that person. Or a severance fee or liquidated damages may have
to be paid. ICANN could soften the blow and make the event look
prettier to the public by retaining the person with some poo-bah
title that carries no authority.<br>
</p>
<p>The point I'm making here is that the person who argued that
ICANN is not able to change its bylaws and not have the President
as an ex-officio, voting member of the board of directors is not
adequately informed.<br>
</p>
<p>Yes, such a change could have a transient cost that runs through
the end of the employment contract and could lead to some minor
litigation over things like titles and other poo-bah mooing by a
President who objects to being removed from the board of
directors, but still retains the job of President/CEO, including
the salary and benefits.</p>
<p>So the cleaner approach is to make that change to the bylaws but
have it take effect upon the end of the present term of the
employment agreement.</p>
<p> --karl--<br>
</p>
<p><br>
</p>
<div class="moz-cite-prefix">On 7/27/22 2:41 AM, Roberto Gaetano
wrote:<br>
</div>
<blockquote type="cite"
cite="mid:9F2A043F-3398-4BF7-B38A-3C9EBEE9956D@hotmail.com">
<meta http-equiv="Content-Type" content="text/html; charset=UTF-8">
Karl,
<div class=""><br class="">
</div>
<div class="">Following on your “off-topic” (I changed the subject
line) I wold like to add a bit of history.</div>
<div class=""><br class="">
</div>
<div class="">You wrote:</div>
<div class="">
<blockquote type="cite" class="">
<div text="#000000" bgcolor="#FFFFFF" class="">
<p class=""><font class="" face="Times New Roman, Times,
serif">A lot of our BWG proposals are still quite
relevant, for instance, not putting the President/CEO
into a seat on the board of directors ….</font></p>
</div>
</blockquote>
</div>
<div class=""><br class="">
</div>
<div class="">When I was chairing the Board Review WG, I argued
against having the CEO as a voting member rather than ex-officio
observer. Besides any governance model, having to vote on issues
that he would have been called to execute could put the CEO in
an embarrassing position: what if he voted against, and the
motion passed? This was, IMHO, not just a theoretical exercise,
but something that could really happen on politically sensitive
issues, like the .xxx delegation (in that case, Paul abstained,
and the application was rejected by one or two votes).</div>
<div class=""><br class="">
</div>
<div class="">My approach was considered, but the Chair argued
that for the current CEO the provision was built in the
contract, and could not be changed, but this would have been
taken into account for the next CEO. Then I left the Board, and
lost track of the later events, but it looks that the situation
still remains unchanged.</div>
<div class=""><br class="">
</div>
<div class="">Cheers,</div>
<div class="">Roberto</div>
<div class=""><br class="">
</div>
<div class=""><br class="">
</div>
<div class=""><br class="">
<div><br class="">
<blockquote type="cite" class="">
<div class="">On 26.07.2022, at 21:39, Karl Auerbach via
At-Large <<a
href="mailto:at-large@atlarge-lists.icann.org"
class="moz-txt-link-freetext" moz-do-not-send="true">at-large@atlarge-lists.icann.org</a>>
wrote:</div>
<br class="Apple-interchange-newline">
<div class="">
<div text="#000000" bgcolor="#FFFFFF" class="">
<p class="">I'm going to be somewhat diverging from the
main topic....<br class="">
</p>
<div class="moz-cite-prefix">On 7/26/22 8:14 AM, Marita
Moll wrote:<br class="">
</div>
<blockquote type="cite"
cite="mid:2a9ce903-81b5-5f85-3428-a8c3e1de2a02@ca.inter.net"
class="">
<p class=""><font class="" face="Times New Roman,
Times, serif">And so it is with ICANN. It exists
-- a unique multistakeholder governance system.
Lots of things wrong with it. But it exists. So,
for those who want to, they can keep working at
it, keep looking for improvement, keep challenging
the system.</font></p>
</blockquote>
<p class=""><font class="" face="Times New Roman, Times,
serif">I've long been in opposition to the
"stakeholder" model of governance. I was horrified
when I first saw it
</font><font class="" face="Times New Roman, Times,
serif"><font class="" face="Times New Roman, Times,
serif">just after Jon Postel died</font>, and
became more horrified watching Joe Sims of Jones Day
ramming it down our collective throats. In the
Boston Working Group proposal for "NewCo" we tried
to mitigate some of the worst aspects.</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif">See <a class="moz-txt-link-freetext"
href="https://cavebear.com/archive/bwg/"
moz-do-not-send="true">
https://cavebear.com/archive/bwg/</a> for the
Boston Working Group proposals.</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif">A lot of our BWG proposals are still quite
relevant, for instance, not putting the
President/CEO into a seat on the board of directors
and moving some ICANN powers into the Articles of
Incorporation and requiring exercise of those powers
to be approved by more than merely the board (in
those days that larger body could have been "the
members" but ICANN sank that ship long ago - but it
can be, and ought to be, re-floated.)<br class="">
</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif">My most recent piece in opposition to
stakeholder based systems may be found here:</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif">Democracy Versus Stakeholderism -
<a class="moz-txt-link-freetext"
href="https://www.cavebear.com/cavebear-blog/stakeholder_sock_puppet/"
moz-do-not-send="true">
https://www.cavebear.com/cavebear-blog/stakeholder_sock_puppet/</a><br
class="">
</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif"> --karl--</font></p>
<p class=""><font class="" face="Times New Roman, Times,
serif"><br class="">
</font></p>
</div>
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