SCN: ICANN

[Steve]

x-no-archive: yes

===================


Karl Auerbach, elected to the Internet domain-name authority with 
a mandate from the people, explains why he is suing his own 
organization.  

(Damien Cave, Salon)---Karl Auerbach began his tenure at ICANN, 
the Internet Corporation for Assigned Names and Numbers, with a 
mild sense of optimism. By the time he joined the board of directors 
in November 2000, the nonprofit -- the controlling authority over 
the allocation and administration of Internet domain names -- had 
already earned a reputation for ineptitude and closed-door policies 
that favor corporate interests. But as one of five board members 
(out of 19) elected at large by the general public, Auerbach 
intended to guide ICANN toward reform.  

Auerbach's hopes have not been realized. In February, ICANN 
CEO and president M. Stuart Lynn proposed a massive overhaul 
of the organization -- a shift of power away from public input 
toward national governments. At a meeting in Accra, Ghana, last 
week, ICANN agreed to go along, suspending at-large elections 
until further notice.  

Auerbach -- a founder of several software companies who also 
spent time protesting the Vietnam War -- isn't ready to fold his tent 
yet, however. On Monday, he sued the organization he represents. 
He filed charges in California Superior Court against ICANN for 
withholding financial information in violation of a state law that 
gives directors "the absolute right at any reasonable time to 
inspect and copy all books, records and documents of every kind."  

ICANN officials couldn't be reached for comment.  

Salon chatted with Auerbach about the case and other ICANN-
related matters.  

You've been trying to see ICANN's financial records for a while. 
What led you to file a lawsuit?  

I made my first request to see the financials within five minutes of 
my election to the board. ... I submitted written requests. They 
went off and hemmed and hawed and said they'd have to write 
procedures and send it to such-and-such committees. ICANN has 
a committee structure that makes the U.S. government look simple. 
 
But nothing happened and I wrote more letters. Then, eventually, 
finally, around September, I get, out of the blue, this set of 
procedures, which Stuart Lynn simply declared by fiat to be 
applicable to all directors.  

What were the procedures and why didn't you comply?  

No. 1, they were unlawful in that they put conditions on me, which 
impaired my ability to make independent judgments. I essentially 
have to ask the approval of management to see certain 
documents. They go cogitate and then tell me whether I can see 
them. And they place conditions on my use of that material. They 
call it a nondisclosure, but it really amounts to conditional use.  

So there are two parts to this: First, I'd have to sign the general 
agreement; then there would be additional conditions when I 
showed up at the door. To do this would be to abrogate my duties 
as a director. It would be contrary to my duty as a director to sign 
the agreement.  

And what's really interesting is that through all of this process -- 
with Stuart piling more and more procedures on me -- he 
responded, out of the blue, to one of my requests. It was a request 
for fairly innocuous information -- I wanted the logs of international 
travel of all officers and executives for all international travel not 
pertaining to a board meeting -- but nevertheless he felt free to 
dispense with all of these procedures [and give me the logs] with 
just the wave of his hand. So he's playing fast and loose with these 
procedures.  

What are you hoping to achieve with the suit?  

I want to look at the records because I want to make better 
decisions. Part of Stuart's reorganization plan is inspired by the 
fact that ICANN is running out of money and needs cash. So I want 
to know where the cash is going. All I've seen are broad public 
statements and, to my eyeballs, they're very deficient. And I want 
to understand the conflicts of interest. I've seen signs that there 
are conflicts of interest at Jones, Day [the Washington law firm 
retained by ICANN] and elsewhere and I want to know the details.  

What's going on is that we have the classical tension between 
managers and directors. This has been going on at corporations 
ever since they've existed. But at ICANN we have a passive board 
and an activist management who seem to want to be building an 
empire.  

Some folks just don't get the notion that directors are there to 
oversee the corporation. ICANN's management seems to consider 
the board as a kind of rubber stamp to be used to approve 
management's fait accomplis.  

I guess that some folks just haven't learned from Enron. My own 
sense is that this lack of director responsibility is mirroring the 
crisis in corporate accounting as shown by Andersen in the Enron 
situation.  

In corporations, especially nonprofits and tax-exempts like ICANN, 
the public interest is often protected only through the vehicle of 
active, inquiring directors. As directors become lax and lazy, or in 
ICANN's case, as corporate management imposes unlawful 
limitations on directors that the directors accept, then the 
corporation becomes unaccountable and the public loses.  

Look at Lynn's reform plan. His response to ICANN not having 
enough money is to build an ICANN that has 10 times the budget.  

But Lynn is arguing that he's trying to streamline the organization 
and make it more effective -- goals that you share.  

Yes, but his budget went up tenfold. It went from a couple million to 
$23 million. And it's virtually all staff people. So even if you give 
$250,000 per person per year, we're talking about 100 people. It's 
already too large with 20 people. I mean, what are they doing? 
ICANN's job is supposed to be narrow and technical. And here it is, 
20 people? What in the world are they doing? It's inconceivable.  

That's why I want to look at the records, to find out where the 
money goes. Why does it take $2.4 million (47 applicants paid 
$50,000 each) to evaluate seven top-level domains?  

What do you make of ICANN's decision to suspend at-large 
elections -- the format that put you on the board?  

I'm just appalled at the at-large study committee, which came back 
and said, "Oh, well, this is an improvement for the at-large 
community because they can organize." Well, we've always had 
the ability to organize so-called garden clubs of comment. It's the 
lack of the vote that matters. This is something that ICANN has 
promised Congress, promised the public, ever since its inception. 
Now, it's gone back on its promise.  

But there were serious problems with the last election. Countries 
like China, for example, pounded the servers in what appears to 
have been an attempt to stuff the ballot box.  

There were large problems with the U.S. election, but we didn't 
tear down the U.S. and rewrite the Constitution, did we?  

What kinds of alternatives are you offering? How do you think 
some of the problems, particularly with fraud, should be fixed?  

First, get rid of management. Here are people whose primary belief 
is that elections will never work, therefore they don't try. There's a 
lack of will here. Also, we don't have to have electronic elections. 
We can have good old paper elections, the kind that work for all 
kinds of nonprofits all over the world. You send people an 
envelope, they fill out the paper and send it back.  

Is that so hard? Is that so extensive?  

Why do you think these kinds of things aren't being considered?  

Because it gets in their way of building an empire. A lot of people 
really get excited by having a huge organization chart with them at 
the top, and with lots of money to spend. And that's what ICANN is 
turning into -- bureaucracy upon bureaucracy.  

Do you think the removal of at-large elections is the biggest flaw 
with Lynn's proposal? What other problems do you have with the 
plan?  

The repudiation of public participation is the most egregious part. 
The imposition of the nominating committees [under Lynn's plan, 
five members of ICANN's board would be chosen by the 
organization's internal committees] is just awful because it creates 
a self-perpetuating organization in which the insiders determine 
who will be let in. It's very much like the College of Cardinals in 
Rome, who are not going to let a Protestant become pope.  

As far as finances go, the thing is just naive. Here he is asking 
governments to pay. Who in the U.S. has been the most vociferous 
opponent to ICANN at the federal level? Congress. If anybody at 
ICANN would bother to read something simple, like the U.S. 
Constitution, they'd recognize that funds have to be approved by 
Congress; the executive branch doesn't print money and spend it. 
If someone's going to pay ICANN, it's going to have to be passed 
by Congress. And that certainly gives Congress a much stronger 
level to exert control.  

And how are you going to get governments to agree? 
Governments are required, under the Lynn plan, to gather into 
clubs and select someone. But now, according to a recent 
clarification, they have to select from a list prepared by this council 
-- and then pay for the privilege.  

>From a financial point of view, it's very naive. And it's also naive 
from a legal point of view.  

Is there anything in the plan that's useful?  

I think it would make great kindling for a fire. There's nothing in it 
that's useful.  


Copyright 2002 Salon.com





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