[registrars] Answers to Various Questions

["Michael D. Palage" <michael@palage.com>]

Hello All:

I apologize for the delay in getting back to some of the various questions
that have been posed to me both publicly and privately by various members.
Listed below are some of the questions and answers. Should anyone else have
any questions please let me know.

Best regards,

Michael D. Palage


QUESTION 1: (complied from various email)

80%! Where does that number come from?  In every other voting body I have
ever heard of, a 3/4 majority is nearly impossible to get, so hard it is
only rarely if ever actually required.  Usually, a 2/3 majority is all that
is required to take an extraordinary action like overriding a veto,
expending very large sums of money or changing organizational instruments.

So tell us, where does it say that an 80% majority is required to have
"consensus?"  Where is consensus defined at all?  Once could fairly argue
that a "simple majority" does not make consensus, although its a hard
argument to make.  Harder still is to say that 2/3 majority is not
consensus, but 3/4?  No way.

What we do have is a formal vote of strong opposition to WLS by the members
of the DNSO.  I would say we have consensus opposing WLS in the DNSO
because that motion was adopted 3 to 1.  We don't need complete agreement
for consensus.  75% is adequate.

ANSWER 1:

The previous proposals that we voted on have provided guidance to Ross in
his negotiations to date. However, what we have now is a new document
prepared by the DNSO Names Council task force that our Names Council
representatives must vote on. The current by-laws read:

The three Names Council representatives will act as Registrar Constituency
representatives and not as those of their respective entities or
organizations. As far as it is practical, Names Council representatives
shall consult all relevant matters and decisions with the Registrar
Constituency.

Historically the registrar constituency has really never been divided on an
issue before the names council, so it was pretty much taken for granted that
the three representatives would vote as a block to represent the views of
the constituency. Although the initial vote was overwhelmingly against the
WLS as originally proposed, the current straw poll in Bucharest showed a
smaller majority opposed to it. I believe the vote was 13 to 9 with one
abstention. Tim should have the exact vote in his minutes.

There is no where in ICANN by-laws in which consensus is defined by a
magical number. As former Chair of Working Group B there was much debate on
this issue during the formative months of the DNSO following Berlin. After
consulting various sources, the number 70% was used for defining consensus.
The other place that a numerical value is used is in connection with our
ICANN accreditation agreement that require 66% of the registrar market share
to approve ICANN's annual budget.

The question that needs to be answered immediately is how should our three
Names Council representatives vote on the WLS Task Force recommendation. The
choices are (1) as a block or (2) representative of the actual vote.

Under Choice 1 if there is a simple 51% majority all three Names Council
representatives should vote as a block
Under Choice 2 if there is greater than a majority but less than 66%, should
the Name Council representatives votes be apportioned to reflect the vote of
the constituency, i.e. 2 to 1.

I do not know the answer to this question and it is up to the constituency
to collectively decided it ASAP or risk not having our voice properly heard
during the upcoming Names Council vote.

QUESTION 2:

What took place in Bucharest regarding a straw poll.


ANSWER 2:

I believe Ross and Bruce summarized properly the events of what took place.
However, to recap, in my email on the 26th of June I provided a brief
summary of the events that took place in the registrar constituency meeting.
As my email indicates I asked Tim to send a ballot to the list. The next
morning, I saw Tim and I asked him if he had sent the ballot. He had not
because their was interment email problems for those of us that did not have
wireless NIC cards. I then spoke with Ross and he stated that because of the
limited amount of time, the Names Council would not be voting on the Report.
Because there was not going to be a Names Council vote, and there was only a
few hours (5-8) for registrars to comment/vote, I told Tim that it would be
best to put it to a formal vote when the final report was presented.
Therefore, at no time was the voice of those registrars not in attendance at
risk of not being heard.


QUESTION 3:

Why all the concern about anti-trust issues, is this just being used to
scare people into letting the WLS get approved.


ANSWER 3:

No. Since the WLS first emerged on the radar I have recused myself from the
discussion and Rick Wesson has been the principal person from the Executive
Committee handling this issue. It has taken me three years to earn the trust
and respect of most registrars on this list and I am not going to throw it
away. Although always aware about potential anti-trust issues, it was not
until Margie Milam general counsel of MarkMonitor raised it during the
constituency meeting in Marina del Ray that it emerged on my radar screen.
Based upon her experience in this area of the law, I saw the potential
problems that this industry potentially faces and the need to be careful.
That is one of the reasons that I added the topic during our Feb special
meeting.

Although I consider myself very knowledgeable on intellectual property and
registrar/registry liability issues, I am not a anti-trust type of guy, but
I do know enough to tread carefully. The one case from that I always keep in
the back on my mind is In re Montgomery County Real Estate Antitrust
Litigation, 83 F.R.D. 305 (1979). Basically what happened was during an
association meeting in Maryland, one of the realtors stood up and said "I
don't know about you all, but I can go broke at 7% just as well as I can at
6%, and tomorrow that's where my rates are going to be." Nobody said
anything, and the realtor got up and left. Shortly thereafter, the rates of
the realtors in the area began increasing the 1% to the stated 7% level. The
Department of Justice prosecuted several realtors criminally for an
agreement to fix prices, which resulted in convictions. The convictions were
upheld on appeal. The fact that our actions could potential result in jail
time is something that we NEED to take seriously. I also recently read
several press releases where US anti-trust laws where applied to actions
involving foreign companies - see
http://www.usdoj.gov/atr/public/press_releases/2002/10863.htm and
http://www.usdoj.gov/atr/public/press_releases/2002/10908.htm. This is not
just a problem for US registrars to worry about.

I will try to get a copy of this case to circulate to the list.