
California Attorney General delays .org sale - bbatsell
https://domainnamewire.com/2020/01/31/breaking-california-attorney-general-delays-org-sale/
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ISO-morphism
From the AG letter:

> 24\. If ICANN approved the removal of the price cap for registration fees
> for .org domains, provide a detailed explanation how this occurred,
> including when and who initiated the process to remove the price caps and
> how it was ultimately approved;

...

> 35\. Your conflict of interest policy.

I think it's a good sign they're asking for specific individuals. Really looks
like they're not fooling around.

~~~
FireBeyond
I'd love it if they required the de-redaction of some of the individuals
involved. I think that could prove entirely enlightening to some of the _real_
motivations at play.

~~~
ISO-morphism
> 5\. PIR's unredacted response to ICANN's request for additional information
> regarding the acquisition of PIR by Ethos Capital

> 27\. Identify all individuals at ICANN involved in analyzing and/or making
> recommendations regarding the removal of the price cap for .org domains

Seeing the words "unredacted" and "individuals" makes me hopeful for this.
Feels like they're saying "not gonna fly" to "orders were orders."

> 34\. Provide the names and contact information of all of ICANN's members of
> its Board of Directors, including all non-voting members

And at the same time no to "it was a rogue employee "

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koolba
It’s nice to read some good news for a change.

From the article:

> The current deadline for ICANN to approve or deny the sale is February 20.
> It is asking Public Interest Registry to extend this to April 20 as a result
> of the attorney general office’s request.

> This is perhaps the biggest wrinkle so far in Internet Society’s plans to
> sell the registry for $1.135 billion to a private equity company.

Are the details outside the amount public and is there any clawback amount if
the deal does not go through?

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ajnin
Looks like the AG is considering that case seriously, they're asking a very
extensive list of information, including information on how the decision to
remove price caps was made, the names if individuals involved, and
confidential details of the deal with Ethos Capital. They definitely already
studied the case to ask the pertinent questions. Hopefully this is treated as
seriously as it is for the Internet and any decision where corruption was
involved, or that is detrimental to the interests of non-profits, is not
allowed to go through.

~~~
kevin_thibedeau
It looks like this scheme is going to collapse now. The next important thing
is to reinstate the price caps.

~~~
zaphirplane
What i would like to understand is what’s California jurisdiction is

~~~
lmkg
From the letter the AG sent:

> *The Office of the Attorney General has the duty to supervise charitable
> organizations under [law#]. The [ICANN], as a registered nonprofit in
> California, is subject to regulation by the California Attorney General.

Sort, IANAL answer: They are incorporated in California, making their
corporate conduct subject to California's laws.

Source: This PDF, starting on page 3.

[https://www.icann.org/en/system/files/correspondence/jeffrey...](https://www.icann.org/en/system/files/correspondence/jeffrey-
to-nevett-30jan20-en.pdf)

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type0
Here's the audio interview with one of the ISOC trustees attempting to defend
his vote for the sell
[https://www.techdirt.com/articles/20200115/11301343739/techd...](https://www.techdirt.com/articles/20200115/11301343739/techdirt-
podcast-episode-234-mike-godwin-defends-selling-org.shtml) His mental
gymnastics there are just incredible.

~~~
fladrif
Mike Godwin make several claims that the only way for the .org tld to survive
is that it requires capital to improve. Another point that is repeated is that
PIR (current owner of .org) is constantly making a surplus of money. The
reasoning for this disparity is that a non-profit cannot use money it
generates to improve itself. Is this a valid point, and if so why?

~~~
labster
Nonprofits in California are allowed to take out loans to acquire capital.
They are also allowed to spend money to improve the service they offer in the
furtherance of their tax-exempt purpose, so long as the capital expenses don't
count as self-dealing (like the .org sale, allegedly). There's no legal basis
for either of those claims. The thing they can't do is go out and sell equity
for VC money on their core purpose, or exceed the legal threshold for
unrelated business income. But neither should be necessary to improve the
nonprofit, especially given that it already has a surplus of money.

~~~
techsupporter
> Nonprofits in California are allowed to take out loans to acquire capital.

Just as point of clarification, California non-profit corporation law wouldn't
apply to Public Interest Registry. It is formed and domiciled in Pennsylvania.
That said, Pennsylvania law appears to permit non-profit corporations to take
on debt in the same way that any other corporation formed under PA law can do
(subject to rules found in the organization's bylaws or formation documents,
which I've not read for PIR). Title 15 of Pennsylvania's consolidated
statutes, section 5502(6) reads that a non-profit corporation has the
authority "[t]o borrow money, issue or incur its obligations and secure any of
its obligations by mortgage on or pledge of or security interest in all or any
part of its property and assets, wherever situated, franchises or income, or
any interest therein."

I can't think of a reason why PIR, with a surplus of annual income, would have
any trouble receiving a loan from any number of financial institutions. In
fact, the vast majority of credit unions would be tripping over themselves to
make such a loan, based on what I've seen of PIR's financials. Taking out a
loan against surplus income to make cash-intensive improvements to the non-
profit in furtherance of its mission is basically the whole point of running a
surplus that isn't distributed back to members.

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bibinou
AG Letter is page 3 of this pdf:
[https://www.icann.org/en/system/files/correspondence/jeffrey...](https://www.icann.org/en/system/files/correspondence/jeffrey-
to-nevett-30jan20-en.pdf)

~~~
jdkee
"35\. Your conflict of interest policy."

~~~
londons_explore
Does a conflict of interest actually make something illegal? I was under the
impression that while best practice to declare and avoid conflicts of
interest, it was not actually illegal as long as the motives for each decision
were defensible.

~~~
dchyrdvh
35 isn't a request, but a message from a powerful politician to the people
behind the sale. It's hard to guess the exact meaning without full context,
but I think it's "I know enough. If you want to proceed with the sale, you
have to give me the names and I'll send some of them to prison." They may try
to call his bluff, but they'll be sorry if he indeed knows something.

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MaxBarraclough
Also on The Register:
[https://www.theregister.co.uk/2020/01/31/icann_dot_org_sale/](https://www.theregister.co.uk/2020/01/31/icann_dot_org_sale/)

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JohnFen
This is welcome news. Perhaps there's a slim glimmer of hope here.

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woodandsteel
The question is what the private equity firm will do with .org that it thinks
will earn a good profit on the 1.145 billion it is investing. And would that
leave the internet better or worse off. Did ICANN even ask that question?

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donmcronald
> If it gets the answers it demands, it will get much more information than
> ICANN has previously disclosed about the process and thinking behind
> removing price caps on .org domain names last year.

If?

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3fe9a03ccd14ca5
Can someone help me understand why a domain name still costs $10-$13 a year to
own? Even with so many tlds (presumably competition) it’s still expensive.
Why?

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jacobreg
How does the jurisdiction work on this? Presumably not all regions of all
countries involved in ICANN have this power.

~~~
lmkg
ICANN is incorporated in California.

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cosmodisk
Can anyone give some pros and cons on each side of this?

~~~
freehunter
Of selling the .org registry?

Pro: ICANN can make a shitload of money.

Con: .org domains get a shitload more expensive.

~~~
vajrabum
Con: a private equity firm potentially gets to control who gets .org domains.
That probably shouldn't be a private decision at all.

