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Lawyers, other representatives, expert(s), tribunal’s secretary

Procedural Order No. 5 (Ruling on the Parties’ Motions to Compel Disclosure)

Procedural Background

1.
As provided in Procedural Order No. 1, the parties timely served their respective disclosure requests and responses and objections. The parties attempted to informally resolve the objections, including through videoconferences between lead counsel, but were unable to reach agreement on a number of issues. As provided in Procedural Order No. 2, the parties thus submitted motions to compel the disclosure of documents that the other party refused to produce (on November 4, 2020), followed by responses to those motions (on November 24, 2020).
2.
On December 2, 2020, at 8:00 a.m. Pacific Time, a hearing was conducted via Zoom videoconference on the parties' motions to compel disclosure. The following individuals participated:

Flip J. Petillion (Petillion, Huizingen, Belgium), counsel for Claimant, Namecheap, Inc. (“Namecheap” or “Claimant”)

Jan Janssen (Petillion, Huizingen, Belgium), counsel for Claimant

Jeffrey A. LeVee (Jones Day, Los Angeles, CA), counsel for Respondent, Internet Corporation for Assigned Names and Numbers (“ICANN” or “Respondent”)

Kelly Ozurovich (Jones Day, Los Angeles, CA), counsel for Respondent

Casandra Furey (Associate General Counsel, ICANN)

Amy A. Stathos (Deputy General Counsel, ICANN)

Glenn P. Hendrix, Chairman of the Independent Review Panel (the “Panel”)

Grant L. Kim, Panel Member

Christof Siefarth, Panel Member

Tom Simotas, International Centre for Dispute Resolution (“ICDR”)

The hearing was adjourned at approximately 11:30 am Pacific Time. By agreement of the parties, the hearing was recorded.

3.
In addition to legal memoranda supporting their respective motions to compel and opposing the motion to compel submitted by the other party, the parties prepared charts similar to “Redfern Schedules” reflecting, for each document request, a description of the documents requested, the parties' respective positions on the request, and any resolutions reached during the course of the meet-and-confer process.
4.
Prior to the hearing, on December 1, 2020, the Panel submitted the following questions to the parties in connection with the motions to compel:

i. For Namecheap Request No. 1, ICANN proposes an end date in November 2019, but its proposed beginning date is not indicated. It is our understanding that ICANN is proposing to search ESI for certain email custodians for documents and communications regarding the modification and/or removal of the price control provisions in the 2019 .org, .info, and .biz registry agreements.

a. How far back will those ESI searches go?

b. What is that date tied to? The date that ICANN staff began considering modification or removal of the price control revisions? The date that the ICANN board began considering modification or removal of the price control revisions? The date that ICANN began discussing the possible modification or removal of the price control revisions with the registry operators? The date that ICANN began negotiating the possible modification or removal of the price control revisions with the registry operators? Some other date?

c. As to documents related to the .org, .info, and .biz registry agreements prior to 2019, is there some narrow subset of documents related to the most recent prior agreements, such as final executed agreements and/or external communications between ICANN and the registries, upon which the parties could agree?

ii. In connection with Namecheap Request No. 3, is Namecheap still asserting a claim for relief regarding the proposed (but now withdrawn) change of control of PIR [Public Interest Registry]? (We understand that Namecheap contends that the proposed change of control could have motivated the removal of price controls, but this strikes the Panel as different from asserting a claim for relief in connection with the proposed change of control.) If Namecheap is not asserting a claim for relief in connection with the formerly-proposed/withdrawn change of control, why shouldn't the Panel accept ICANN's proposal to produce documents and communications regarding the proposed change in control only to the extent that these documents and communications also refer to the modification and/or removal of the price control provisions in the 2019 .org, .info, and .biz registry agreements?

iii. Have the parties discussed possible ESI custodians and search terms? Would agreement on custodians and search terms perhaps moot some of the disagreements regarding the scope of ICANN's ESI production?

iv. In connection with Namecheap's Request No. 2, ICANN states that it “does not maintain as a matter of course some of the data Namecheap seeks.” Does ICANN maintain any of the data? For Namecheap, how would the historical data that it is seeking aid the Panel in assessing whether the removal of price controls for the .org, .info, and .biz registry agreements violated ICANN's Articles of Incorporation or Bylaws?

v. Does Namecheap have any non-privileged documents that it can produce in response to ICANN's Requests 1 and 2 (regarding alleged harm)?

a. If ICANN were granted leave to file a motion to dismiss for lack of standing, would Namecheap seek to present any documents (aside from one or more expert reports) opposing that motion?

b. We understand that Namecheap stated at the hearing before the Emergency Arbitrator that it was willing to provide an affidavit explaining why the removal of price controls causes harm to Namecheap. Would it be helpful to set a date for Namecheap to produce such a document at this point, so that ICANN could then make a decision as to whether to challenge Namecheap's standing?

vi. Regarding ICANN's Request No. 3, it is the Panel's understanding that Namecheap is willing to provide the requested price information. Why are all notifications and communications associated with price changes also necessary? Could the scope be narrowed?

vii. How, if at all, does the standard of review to be applied by the Panel in its ultimate decision on the merits impact the scope of disclosure? The Emergency Arbitrator Decision applied the business judgment rule set forth in Section 4.3(i)(iii) of the ICANN Bylaws, which provides that “(f)or Claims arising out of the Board's exercise of fiduciary duties, the IRP Panel shall not replace the Board's reasonable judgment with its own so long as the Board's action or inaction is within the realm of reasonable business judgment.” It appears that the Claimant argued for a different standard, relying at least in part on ICM Registry v. ICANN, ICDR Case No. 50,117 T 00224 08 (2010). The Panel does not wish to sidetrack the hearing tomorrow with argument regarding which standard is proper in this case (although we will need to tackle that issue at some point), but is interested in whether the parties' views on the standard of review affect in any way their views on the scope of disclosure.

The Panel's Rulings

5.
Appendix A and Appendix B to this Order set forth the Panel's rulings on each disputed disclosure request submitted by ICANN and Namecheap, respectively. Both Appendices were issued to the parties in advance of this Order, on December 18, 2020.
6.
The starting point for the Appendices was the Redfern Schedules prepared by the parties. The Panel's rulings were inserted into the final column of each schedule.
7.
The following provides further explanation and context for the rulings in the Appendices.

General Principles

8.
Rule 8 of the ICANN Interim Supplementary Procedures for ICANN Independent Review Process (the “IRP Procedures”) provides:

On the motion of either Party and upon finding by the IRP PANEL that such exchange of information is necessary to further the PURPOSES OF THE IRP, the IRP PANEL may order a Party to produce to the other Party, and to the IRP PANEL if the moving Party requests, documents or electronically stored information in the other Party's possession, custody, or control that the Panel determines are reasonably likely to be relevant and material to the resolution of the CLAIMS and/or defenses in the DISPUTE and are not subject to the attorney-client privilege, the work product doctrine, or otherwise protected from disclosure by applicable law (including, without limitation, disclosures to competitors of the disclosing person, group or entity, of any competition-sensitive information of any kind).

IRP Procedures, Rule 8 (emphasis added).

9.
The ICDR Rules provide that the Panel may “require a party to make available to another party documents in that party's possession not otherwise available to the party seeking the documents, that are reasonably believed to exist and to be relevant and material to the outcome of the case.” ICDR Arbitration Rules, Art. 21(4). The ICDR Rules provide further that the Panel and the parties “should endeavor to avoid unnecessary delay and expense while at the same time avoiding surprise, assuring equality of treatment, and safeguarding each party's opportunity to present its claims and defenses fairly.” Id., Art. 21(1).
10.
The ICANN Bylaws provide that the independent review process (“IRP”) is intended to “[l]ead to binding, final resolutions consistent with international arbitration norms that are enforceable in any court with proper jurisdiction.” ICANN Bylaws, Section 4.3(a)(viii).
11.
The ICANN Bylaws contain numerous references to transparency, including Section 3.1, which provides that “ICANN and its constituent bodies shall operate to the maximum extent feasible in an open and transparent manner …” and that “ICANN shall also implement procedures for the documentation and public disclosure of the rationale for decisions made by the Board and ICANN's constituent bodies.”
12.
Regarding IRP proceedings, specifically, Section 4.1. of the ICANN Bylaws provides that:

In carrying out its Mission, ICANN shall be accountable to the community for operating in accordance with the Articles of Incorporation and these Bylaws, including the Mission set forth in Article 1 of these Bylaws. This Article 4 creates reconsideration and independent review processes for certain actions as set forth in these Bylaws and procedures for periodic review of ICANN's structure and operations, which are intended to reinforce the various accountability mechanisms otherwise set forth in these Bylaws, including the transparency provisions of Article 3 and the Board and other selection mechanisms set forth throughout these Bylaws.

ICANN Bylaws, Section 4.1 (emphasis added).

13.
Distilling the foregoing:

• Subject to applicable privileges, the Panel may order the disclosure of documents or electronically stored information (ESI) that:

o are reasonably likely to be relevant and material to the resolution of the claims and/or defenses in the dispute; and

o are not subject to the attorney-client privilege, the work product doctrine, or otherwise protected from disclosure by applicable law (including disclosures to competitors).

• The Panel is charged with endeavoring to avoid unnecessary delay and expense while at the same time avoiding surprise, assuring equality of treatment, and safeguarding each party's opportunity to present its claims and defenses fairly. In doing so, the Panel considered the need for proportionality. This involves balancing the disclosure necessary for a fair search for truth—which may fall short of an idealized notion of perfection (for example, complete and full disclosure of each and every conceivably relevant document)—against the burden and cost of disclosure. The Panel applied this principle in the rulings in the Appendices where it denied all or part of a request on the ground that the requested documents may be only marginally relevant and material relative to the burden of production.

• International arbitration “norms” are generally applicable here, although there is no single international arbitration “norm” regarding the scope of disclosure. As stated in one widely-cited treatise, it is “impossible to identify a single ‘standard' approach to disclosure in international arbitration.” GARY BORN, INT'L COMM. ARB. (2nd ed.), at 2346 (2014). “Nevertheless, there is an emerging consensus among experienced arbitrators and practitioners that a measure of document disclosure is desirable in most international; disputes. Justice is almost always best served by a degree of transparency, which brings the relevant facts before the arbitrators.” Id. Even so, the scope of disclosure in international arbitration is narrower than in U.S. civil litigation, and the Panel has been guided in part by that consideration here. The reference in the Appendices to “GDPR or other privacy laws” also takes into account the international character of this IRP proceeding.

• ICANN is obligated to act in an “open and transparent manner” and, indeed, one of the purposes of an IRP proceeding, including this matter, is ensuring that ICANN is accountable to the Internet community, including in connection with “the documentation and public disclosure of the rationale for decisions made by the Board and ICANN's constituent bodies.” That obligation, together with the fact that the sole issue in this proceeding is whether ICANN complied with its Articles of Incorporation and Bylaws, means that disclosure will necessarily be somewhat asymmetrical, with ICANN sustaining a heavier burden than Namecheap.

“Reasonable Search”

14.
Certain rulings in the Appendices direct the parties to conduct a “reasonable search” for documents. In conducting a reasonable search for ESI, the parties shall meet and confer regarding ESI protocols addressing at least the following issues:

o The locations that will be searched for relevant ESI;

o The persons (custodians) likely to possess relevant ESI; and

o The methods to be used to collect ESI. For example, will search terms be used, or will the parties use predictive coding or computer assisted review? If search terms are used, what are they? What process will be used to test the search terms to determine whether relevant ESI is likely to be identified by using the proposed search protocol? (At a minimum, the producing party should verify that documents already identified as relevant are included in the search results.)

15.
Each party shall provide the other party with the ESI protocols it intends to use by January 8, 2021, with any objections to be filed by January 22, 2021.

Relevant Time Periods

16.
Except as otherwise specified in Appendix B, the relevant time period for ICANN's production is generally deemed to be January 1, 2018 through November 18, 2019. ICANN indicated during the December 2, 2020 hearing that discussions with the .ORG, .INFO and .BIZ registry operators began in May 2018. The Panel is establishing a January 1, 2018 beginning date to better capture documents and ESI that may reflect internal deliberations or communications, if any, prior to discussions with the registry operators.
17.
For certain requests to ICANN (e.g., Nos. 1.r., 2.1. and 2.t.), the Panel has limited ICANN's obligation to conduct an ESI search to the period of January 1, 2018 through November 18, 2019, but nonetheless requires that ICANN conduct a reasonable inquiry to identify responsive documents and ESI outside that period. Such inquiry shall, at a minimum, include interviews with relevant ICANN staff. If ICANN prefers to supplement such inquiry through e-searches, it may of course do so.
18.
As specified in Appendix A, the relevant time period for Request No. 10 in Namecheap's production is March 18, 2019 through November 18, 2019. The starting date is not symmetrical with the relevant time period for much of ICANN's production because March 18, 2019 is when ICANN first invited public comments on the possibility of removing price controls and thus the first time that Namecheap would have been aware of the proposal.

Further Disclosure

19.
Namecheap requests 2.n., 2.o., 2.p., and 2.q. seek certain data. These requests presently stand denied, but the Panel is potentially open to requiring production, subject to better understanding: 1) the precise data sought by Namecheap and precisely how that data would be utilized by its expert(s) as evidence regarding whether ICANN violated its Articles of Incorporation or Bylaws; 2) whether that data is reasonably available to ICANN; 3) if so, the burden to ICANN of producing that data; 4) whether equivalent data is reasonably available to Namecheap from sources other than ICANN; and 5) whether the data constitutes confidential commercial information or trade secrets of registries or other registrars (or, indeed, competition-sensitive information of any kind, as protected in the IRP Procedures, Rule 8). In the event Namecheap wishes to continue pursuing these requests, Namecheap shall promptly initiate a meet-and-confer process with ICANN to discuss the foregoing factors. If the parties are unable to reach agreement, Namecheap may apply to the Panel by no later than January 15, 2021 for an order to resolve any disputed issues. To be clear, however, the Panel is not encouraging Namecheap to do so, as any such further disclosure will further delay the proceedings, and it is not at all clear at the present time that the requested data will assist the Panel in deciding this matter.
20.
As reflected in Appendix B, the Panel also denied several other Namecheap requests “absent a further particularized showing of relevance, materiality and need.” Namecheap may re-propound those requests upon such a particularized showing. Again, the Panel is not encouraging Namecheap to do so, especially in the absence of any new information that was not previously available, as any such further disclosure might further delay the proceedings and, based on the information presently available, the information sought in these requests strikes the Panel as only marginally relevant, if at all.

The PIR Change of Control

21.
During the hearing, Namecheap's counsel advised in response to the Panel's Question ii. (see Paragraph 4 above) that it was, in fact, still asserting a claim for relief regarding the proposed (but since withdrawn) change of control of the .ORG registry operator (PIR). ICANN then requested leave from the Panel to submit a motion to dismiss the allegations in Namecheap's IRP Request regarding the proposed change of control of PIR. Such leave was granted (as reflected in Procedural Order No. 3) and a briefing schedule was established.
22.
Several disclosure requests relate to the PIR change of control. As reflected in the Appendices to this Order, the Panel defers ruling on those requests pending a ruling on the motion to dismiss.

Other

23.
The parties shall be precluded from relying on documents in the merits phase of this proceeding that were responsive to disclosure requests, but that they did not produce, except upon a compelling showing of good cause. This ruling does not encompass documents that do not already exist and that are created specifically for the hearing, such as expert reports and demonstrative exhibits.
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