Re: [Iasa20] AD review of draft-ietf-iasa2-rfc4071bis-04

["Livingood, Jason" <[e-mail]>]

What I have tried to do for this section (board responsibilities) is to better align it with the LLC agreement. I also added an introductory statement to ensure that it is understood that the LLC Agreement is authoritative.

" This section is intended to provide a summary of key IETF LLC Board responsibilities, but 
the precise and legally binding responsibilities are defined in the LLC Agreement {{IETF-LLC-A}}. 
To the extent to which there are unintentional differences or other confusion between this 
document and the LLC Agreement, the LLC Agreement is in all cases authoritative. "

Brad - Please review this new section once the doc is updated and let me know if it is now better aligned with the LLC agreement. I will send you a copy of what I have for the new doc under separate cover.


JL

On 2/14/19, 12:40 PM, "iasa20 on behalf of Brad Biddle" <[e-mail] on behalf of [e-mail]> wrote:

    Some thoughts on the question Alissa posed to me…
    
    On 13 Feb 2019, at 18:23, Alissa Cooper wrote:
    
    > I have reviewed draft-ietf-iasa2-rfc4071bis-04 in preparation for IETF 
    > LC. I have some substantive comments and questions as well as some 
    > nits that should be resolved before IETF LC.
    
    [ . . .]
    
    > == Section 4.2 ==
    >
    > I'm wondering about how the first section of this text squares with 
    > what is in the LLC Agreement, in a couple of ways:
    >
    > (1) The LLC Agreement does not state that the board has duties of 
    > loyalty, care, and good faith. I don't know if these are implied, but 
    > I think we should hesitate to try to establish these kinds of duties 
    > in the RFC if they aren't established in the legal agreements. Would 
    > be interested in Brad's opinion on this.
    
    I agree with the general principle that this document should not assert 
    that any legal duties or obligations exist that aren’t clearly 
    established in the legal agreements. In this particular case however, 
    I’m OK with making the statement we have here even though those exact 
    words don’t appear in the LLC Agreement. Those duties are imposed by 
    Delaware law. I don’t think there is harm — and there may be some 
    benefit of clearer expectations and understandings — in explicitly 
    stating those duties in this document.
    
    (Possibly of interest: while those duties have long been established as 
    applying to directors of traditional corporations, there was a degree of 
    uncertainty about if and how they applied to managers of LLCs up until 
    2013. Delaware then amended their applicable statutes to clarify that 
    these duties do apply to LLC managers, as a default rule. See 
    <https://www.dlapiper.com/en/us/insights/publications/2013/08/delaware-amends-its-llc-act--managers-and-contro__/> 
    for a short summary.)
    
    
    > (2) The first bulleted list of responsibilities is overlapping but not 
    > the same as the board responsibilities described in 5(d) of the LLC 
    > Agreement. That list is:
    >
    > "The Board will set broad strategic direction for the Company, and 
    > will be responsible for adopting an annual budget, hiring or 
    > terminating an Executive Director (or amending the terms of their 
    > engagement), adopting any employee benefit plans, consulting the 
    > relevant IETF communities on matters related to the Company as 
    > appropriate, approving any changes to the LLC governance structure, 
    > incurring any debt, and approving entering into agreements that that 
    > meet a significant materiality threshold to be determined by the 
    > Board."
    >
    > I can understand that there may be additional responsibilities that 
    > the community expects of the board that aren't listed in the LLC 
    > Agreement (i.e., recruiting new directors). But for the ones that are 
    > listed in the LLC Agreement, I think it would be clearer to use the 
    > exact same phrasing in both places rather than talking about the same 
    > ideas using different words. There is additional wording about 
    > transparency in Exhibit A, Section 13.
    >
    > Similarly, the second bulleted list of responsibilities is a subset of 
    > the obligations in Section 11(a) of the LLC Agreement, using slightly 
    > different words. I don't understand the motivation for including this 
    > list this way. It seems like a reference to 11(a) would be more 
    > appropriate.
    
    I agree that tracking to the language in the LLC Agreement, when 
    relevant language exists, is the right practice to avoid creating 
    ambiguities. While likely not a huge risk — odds of problems arising 
    at all are likely low, and the LLC Agreement terms should always be 
    definitive when applicable — it’s conceivable that these kinds of 
    potential ambiguities could create unnecessary disputes about the scope 
    of legal obligations.
    
    Thanks,
    Brad
    (IETF legal counsel)
    
    
    Brad Biddle | [e-mail] | +1.503.502.1259 (mobile) | 
    https://protect2.fireeye.com/url?k=48744dbd15e34664.48746a09-057a9abb268c2f17&u=http://biddle.law
    
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