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Thursday, November 15, 2012

Today is Conflict of Interest Day at ICANN

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The Internet Corporation for Assigned Names and Numbers shot itself in the foot twice today over conflict-of-interest problems high up in the organization. Little problems in the grand scheme of things, but nevertheless well-publicized glitches for an organization that is facing heightened public scrutiny.

I'm Abstaining ... No, I'm Not

The first involved Brian Winterfeldt, a member of the Generic Names Supporting Organization Council, ICANN's main policymaking body. Winterfeldt, a trademark attorney at Steptoe and Johnson in Washington, D.C., initially abstained on a council motion to grant special trademark protections in the new top-level domains to the Red Cross and the International Olympic Committee. Winterfeldt initially abstained from voting on the Red Cross motion because he believed that the GNSO rules required him to do so. The Red Cross is Winterfeldt's client. The Red Cross motion failed, though it would have passed had Winterfeldt voted for it. Later in the meeting, Winterfeldt realized that he was in fact able to vote on the Red Cross matter. However, the Council chair ruled that it was too late to revisit the motion, so the original vote stood -- a loss for the Red Cross/IOC on the special trademark protections question.

red card  

Before venturing further, I have to confess that my understanding of ICANN conflict of interest rules is a little shaky. The ICANN board has conflict of interest rules that, based on my reading, would have prevented Winterfeldt from voting on the Red Cross matter if they applied to GNSO councillors. However, these rules apply only to the ICANN board.

The GNSO has its own conflict of interest rules that are quite a bit more permissive. The GNSO Operating Rules and Procedures (Dec. 16, 2011) (PDF) acknowledge that GNSO councilors are experts in their fields and, therefore, will frequently be professionally involved in matters that come before the council. The Winterfeldt situation is explicitly addressed by the GNSO operating procedures:

Case 1: a Councilor (attorney by profession) is representing a client in legal action relating to a matter before the Council and, and as required by his/her professional code, must abstain and, furthermore, such abstention should not be counted as a negative vote. [Note: this type of situation requires one of the remedies specified in Paragraph 4.5.3].

Winterfeldt's client is the Red Cross. His client stands to gain a significant advantage against cybersquatters that other trademark owners will not enjoy under the rules as they are currently written. So Winterfeldt should have abstained, right? Not so fast. The GNSO operating rules are written so that abstentions like the one that occurred today are extremely rare.

The "remedies" mentioned in Paragraph 4.5.3 offer two workarounds that clearly are going to kick in when the Red Cross matter comes back before the GNSO Council (most likely next month). First, Winterfeldt could have sought direction on how to vote from the Intellectual Property Constituency. They would have directed him to vote for the motion, clearly. Second, the Intellectual Property Constituency could have selected a "temporary alternate councilor" to stand in for Winterfeldt on the Red Cross matter.

The incident illustrates how, at ICANN, discussions about "conflicts of interest" confound an outsider's expectations. It would be very difficult for the GNSO council to make decisions if the only votes that could be cast were by individuals who have no stake in the outcome of the decision. GNSO councilors make policy, but they are not like policymakers in Congress or in the judicial system or on the local zoning board, where the public expects participants to be free of personal, financial, or professional interests in the matter at hand.

On the GNSO council, it is expected that councilors will represent the various constituencies within ICANN: registry and registrar groups, business owners, internet users, and yes intellectual property owners. That's how the ICANN system works. Instead of making decisions with panels of unbiased officials, ICANN makes policy via a consensus-based process involving all competing interests. Strongly biased views all around. This is why charges of conflict of interest always raise hackles at ICANN meetings. One person's "conflict of interest" is another's "expertise."

Circling back to the Red Cross matter, the naturally expected vote from the Intellectual Property Constituency (represented on the GNSO council by Winterfeldt) would have been "yes" vote. The rules cleary permit him to cast that vote, regardless of his interest in the matter.

Pritz Gone Without an Explanation

Today's second conflict-related development involves the curious resignation of Kurt Pritz, ICANN's chief strategy officer. Pritz is a well-regarded ICANN official who worked to shape its top-level domains initiative, for being the public face of ICANN during recent congressional hearings, and for pushing the new domains program over the finish line during the last few contentious years.

According to a statement attributed to ICANN chief executive officer Fadi Chehade published on the ICANN website:

Kurt has submitted his resignation because of a recently identified conflict of interest, which he immediately communicated to ICANN. After analyzing this conflict of interest, we decided that a change in Kurt’s role within ICANN would be appropriate. Kurt decided to resign his position and role as an officer of ICANN, to best serve the interests of the organization.

ICANN declined to explain the nature of Pritz's conflict, setting off a fair amount of online speculation and condemnation of ICANN's silence. However the facts ultimately turn out, the incident is underscores a basic tenet of good public relations: If you don't put the facts before the public, the public will fill the resulting void with fiction.

Coverage of both these developments can be found at Kevin Murphy's DomainIncite Michael Berkens' The Domains websites.

Update (11/16/12): I've edited this post a bit since it's original publication, to remove some idle speculation on my part that was unfounded and unfair to the parties involved.

(photo credit: wjarrettc on flickr)

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