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auDA may sue to delay boardroom bloodbath

Kevin Murphy, April 23, 2018, Domain Registries

auDA is thinking about taking its membership to court in order to delay a vote on the jobs of four of its directors.

The Australian ccTLD registry has also delayed further consideration of its policy to introduce direct, second-level registrations in .au until late 2019.

Both announcements came in the wake of a government review of the organization, which found it “no longer fit-for-purpose”.

auDA last week asked its members to agree to a postponement of the special general meeting, called for by a petition of more than 5% of its members, at which there would be votes on whether to fire the CEO, its chair, and two independent directors.

Under the law, auDA has to hold the SGM by June 7 at the latest, according to a letter (pdf) sent to members on Friday.

But auDA wants to delay the meeting until mid-September, at the earliest, to coincide with its regular Annual General Meeting.

If its members do not consent to the delay — it gave them a deadline of 4pm local time today, meaning responses would have to be drafted over the weekend — auDA said it “intends to apply for a court order… extending the time for calling the requested SGM”.

The delay is needed, auDA said, in order to give the organization the breathing space to start to implement the reforms called for by the government review.

The government wants the makeup of the auDA board substantially overhauled within a year to better reflect the stakeholder community and to ensure directors have the necessary skills and experience.

In response, auDA has told the government (pdf) that it agrees with the need for reform, but that it will not be able to hit its deadlines unlesss the SGM is delayed.

It also said calling the SGM on time would cost it somewhere in the region of AUD 70,000, based on the cost of a similar meeting last year.

auDA announced separately last week that it is delaying any more discussion on second-level registrations — something the reform campaigners largely are opposed to — “until the second half of 2019 at the earliest”.

Josh Rowe, coordinator of the Grumpier.com.au petitioners, said in his response that he found the request for the SGM delay “extremely disappointing”, adding:

auDA is at an important juncture following the Australian Government’s review. However, it is critical that people with the right skills and experience lead auDA through its reform.

Members have lost confidence in the auDA CEO, and the three auDA independent directors. They do not have the right skills and experience to lead auDA through its reform.

He noted that members do not have the resources to fight auDA in court.

Government gives auDA reform-or-die ultimatum

Kevin Murphy, April 18, 2018, Domain Registries

auDA has just months to either implement sweeping reforms or risk being dissolved and replaced.

That’s the outcome of a review of the Australian ccTLD administrator by the Department of Communications and Arts, published today, that found the organization as it stands today is “no longer fit-for-purpose”.

Among its 29 recommendations, the government is demanding that auDA refresh its board of directors within a year and scrap its “outdated” membership structure.

Minister Mitch Fifield said in a statement:

The central finding of the review is that auDA’s current management framework is no longer fit-for-purpose and reform is necessary if the company is to perform effectively and meet the needs of Australia’s internet community.

He added in a letter to auDA chair Chris Leptos:

In the event that auDA fails to demonstrate progress in achieving the necessary reforms, I will instruct my Department to undertake a public expression of interest process in the future to identify other entities that could administer .au

A failure to reform could even lead to the government itself taking over .au, the report says.

The review did not look at the claims of lavish spending by staff and directors, reported on earlier this week.

Nor does it express any views on the controversial decision to start selling direct second-level .au domains, or to transition the back-end from Neustar to Afilias.

What it does say is that the board of directors needs to be be replaced within a year, using a new membership structure that gets rid of the current “supply” and “demand” classes of member, which differentiate between those who sell domains and those who buy them.

The current system is open to capture or “stacking”, the review says, with it being too easy for individuals to move seamlessly between classes and a lack of clarity on whether domainers should be supply or demand-class members.

Today, the 12-person board comprises the non-voting CEO, three independent directors and four directors elected by each class.

The review states that the board should not get any bigger, but that the majority of directors should be independent, selected by a new six-person Nomination Committee modeled slightly on ICANN’s Nominating Committee.

Directors should be picked on the basis on their experience and skills, limited to two three-year terms, and subject to background screening, the review states.

The government also says that auDA should either replace its current membership classes with either a single membership class open to all or a “functional constituency model” reflecting groups such as consumers, registrars, government, etc.

Fifield said he expects to see “significant” progress on implementing these reforms in the next three to six months.

In a statement, auDA said it welcomed the report and has already begun work on an implementation plan.

Former CEO Chris Disspain, who was fired by the board in 2016, after running the company for 16 years, a move that arguably catalyzed the last two years of chaos at auDA, told DI:

I am pleased that the review has called out a number of important structural issues especially the matter of membership stacking, something that I had raised with the board on a number of occasions towards the end of my tenure and that may have led, at least in part, to my departure.

Leaked memo alleges lavish travel spending at auDA

Kevin Murphy, April 16, 2018, Domain Registries

A report into .au registry auDA’s historical travel expenses has leaked to the Australian media, the latest apparent salvo in the organization’s increasingly personal civil war.

The Sydney Morning Herald this evening reports on “allegations of lavish spending and misuse of expense accounts by some former directors and employees”.

The primary individual targeted (for want of a better word) by the story is Paul Szyndler, former head of public affairs at auDA and one of the three people behind the Grumpier.com.au campaign to ouster auDA’s current CEO and chair.

It seems the Herald has managed to scoop a leaked copy of an audit compiled by PPB Advisory, which has been looking into spending practices at auDA under its previous management.

The existence of this report has been known for some time, but little about its contents had made it into the public domain beyond a slide deck (pdf) alluding to slack controls on travel expenditure.

The newspaper reports that PPB claims Szyndler racked up several thousand dollars of expenses on a family trip to Disneyland to coincide with ICANN 51 in Los Angeles in 2014.

Shortly before the Herald published (overnight in Australia), Szyndler took to an Aussie domainer forum to admit the truth of the allegation, but explain that it was fully compliant with auDA’s expenses policy at the time.

“auDA had a very clear and well understood policy at the time, whereby staff — after receiving best-available business class airfare and accommodation quotes, could spend up to, but NOT MORE THAN that figure on personal arrangements,” Szyndler wrote.

“My family joined me on a number of international trips. None cost any more than it would have cost to send me alone,” he said.

In other words, if he’d left his family at home and skipped Disneyland, he would have spent the exact same amount on a business-class flight for himself.

The Herald also says that PPB identified thousands of dollars being spent on family member travel to exotic locations, credit card cash withdrawals, expensive restaurants and even a “butler service”.

It does not say which specific staffers or directors are alleged to have spent auDA money on those things.

Indeed, Szyndler is the only person connected to specific spending in the Herald’s report.

There’s no mention of any allegations against former CEO and current ICANN vice-chair Chris Disspain — under whose watch these expenses will have been incurred — though the piece does include his blanket denial of wrongdoing.

auDA’s new chair Chris Leptos — who also sits on the PPB board — revealed last week that “several” former directors have been referred to state police over “a number of practices” upon which he did not elaborate.

Szyndler and his other Grumpier auDA members have managed to rack up enough signatures on their petition to force auDA into a special members meeting, date to be determined, that will vote on whether to get rid of Leptos, CEO Cameron Boardman and two other independent directors.

The Australian government has also been probing the organization’s antics since October, and the Herald reports that its findings could be published as soon as tomorrow (today in Australia).

Could auDA be about to get Nominetted?

auDA refers former directors to police

Kevin Murphy, April 14, 2018, Domain Registries

Imploding Australian ccTLD registry auDA has ratted out “several” of its former directors to the local cops, it was revealed this week.

In a message to its community to mark Chris Leptos’ 150th day as chair of the organization, he wrote:

I am disappointed to advise you that in my first week as Independent Chair I was briefed on a number of practices of several former auDA directors. Your Board concluded that those practices warranted referral to the Victoria Police. As you would appreciate, it is not appropriate at this stage to provide further details regarding this matter.

I’m told there are 48 former auDA directors, and auDA has not said which of them have been referred to the police.

Josh Rowe, a former director who’s orchestrating a campaign to oust Leptos, auDA CEO Cameron Boardman, and two other directors, called the move a “heinous act of bullying against all 48 ex auDA directors”.

Another former director, the Aussie domain industry blogger David Goldstein, has suggested that the timing of the revelation was designed to “silence” critics including Rowe.

The Grumpier.com.au petition organized by Rowe and others has forced auDA to hold a members meeting at which the four directors’ future employment will be voted on.

auDA lawyers contacted Grumpier earlier this week to warn that any defamatory or confidential information posted on the site could lead to litigation.

But Leptos has now seemingly confirmed that the special members meeting will in fact go ahead.

Goldstein also suggested that the police referrals are related to insinuations contained within a pair of Freedom of Information Act requests filed late last year by domain consultant Ron Andruff.

In one of Andruff’s FOIA requests, he suggests that auDA may have paid legal fees of up to AUD 120,000 incurred by Rowe when he was sued almost a decade ago by a alleged domain slammer he had regularly criticized.

Rowe has called these inferences “grossly inaccurate” and “defamatory”.

In the other, which we have reported on previously, Andruff has asked for records of expenses incurred by former auDA CEO Chris Disspain, current vice-chair of ICANN.

Both FOIA requests have been denied by the Aussie government and subsequently appealed by Andruff.

Andruff is known to have beef with Disspain after he was passed over for a prominent ICANN volunteer role.

I should note for the record that, for all of the allegations swirling around, I have not seen any evidence directly connecting any individual to any wrongdoing.

Grumpier Aussies call for more blood on the auDA boardroom floor

A group of pissed-off members of the Australian domain name industry are calling for the heads of auDA’s CEO, its new chair, and two other members of its board.

A triumvirate of long-time participants in the auDA community say they have secured enough signatures on a petition to force the organization to call the meeting under Aussie law.

They want a vote of no confidence in the CEO, Cameron Boardman, and the firing of all three “independent” directors: Chris Leptos (also chair), Sandra Hook and Suzanne Ewart.

Their list of beefs is long, but high on it is auDA’s plan to open up .au to direct, second-level registrations for the first time, enabling folk to register example.au instead of example.com.au.

If this all sounds worryingly familiar, it’s because it’s the second year in a row members have called a special meeting in order to oust its top brass.

A campaign orchestrated at Grumpy.com.au last year resulted in chair Stuart Benjamin quitting ahead of a member vote to fire him.

This year’s campaign is being coordinated, with a nod and a wink but none of Grumpy’s original leaders, at Grumpier.com.au.

Entrepreneur Josh Rowe appears to have held the pen on the petition, backed up by former head of auDA public affairs Paul Szyndler and businessman Jim Stewart.

As well as the direct registration issue, which the three men think is merely a cash-grab with no benefits for registrants, the petitioners have some harsh things to say about auDA’s governance and transparency.

The organization has promised to be more open in the wake of last year’s carnage, but Grumpier thinks “things have only got worse”.

The petition also alludes to rumors of “whispering campaigns” against former staff and “possible financial irregularities”.

Rowe recently complained on his blog about a freedom of information request related to his own conduct, filed by the same person pursing form auDA CEO (and current ICANN vice chair) Chris Disspain with FOIA requests.

They also unhappy that auDA is switching .au’s registry service provider from Neustar to Afilias, gaining a rumored 60% discount of which only 10% will be passed on to registrars.

It’s all getting rather nasty, and I’ve not even mentioned some of the rumors of shenanigans that I seem to find in my inbox on an almost daily basis.

To force a special member meeting under Australian law, Grumpier says it had to secure signatures of 5% of the members, which it says it has done.

That’s not much of a threshold, given that auDA only has about 320 members at the moment.

Assuming auDA agrees that it has to hold a meeting, it has a couple of months to do so.