Legally, evaluation of the central claim made entails consideration of the legal standard
governing a board of directors' obligation to supervise or monitor corporate performance. For the
reasons set forth below I conclude, in light of the discovery record, that there is a very low
probability that it would be determined that the directors of Caremark breached any duty to
appropriately monitor and supervise the enterprise. Indeed the record tends to show an active
consideration by Caremark management and its Board of the Caremark structures and programs that ultimately led to the company's indictment and to the large financial losses incurred in the
settlement of those claims. It does not tend to show knowing or intentional violation of law. Neither
the fact that the Board, although advised by lawyers and accountants, did not accurately predict the
severe consequences to the company that would ultimately follow from the deployment by the
company of the strategies and practices that ultimately led to this liability, nor the scale of the
liability, gives rise to an inference of breach of any duty imposed by corporation law upon the
directors of Caremark.