The Court characterized the claim as a “Caremark” claim, in reference to
In re Caremark Int’l Inc. Deriv. Litig., 698 A.2d 959 (Del. Ch. 1996), and
held that the nonparticularized assertions that the directors failed to
prevent accounting irregularities “did not come close” to pleading a
Caremark claim. Importantly, the Court held that the Caremark opinion
“articulates a standard for liability for failures of oversight that requires a
showing that the directors breached their duty of loyalty by failing to
attend to their duties in good faith. Put another way, the decision premises
liability on a showing that the directors were conscious of the fact that
they were not doing their jobs.” Guttman, 823 A.2d at 506.
In an intriguing footnote, Vice Chancellor Strine probed the relationship
between the duty of loyalty and good faith:
corporation unless she acts in the good faith belief that her actions are in the corporation’s best interest. . . . It does no service to our law’s clarity to continue to separate the duty of loyalty from its own essence; nor does the recognition that good faith is essential to loyalty demean or subordinate that essential requirement. There might be situations when a director acts in subjective good faith and is yet not loyal (e.g., if the director is interested in a transaction subject to the entire fairness standard and cannot prove financial fairness), but there is no case in which a director can act in subjective bad faith towards the corporation and act loyally.
The reason for the disloyalty irrelevant, the underlying motive
faithlessness) is it venal, familial,
collegial, or nihilistic) for conscious action corporation’s best interest does not make it opposed to faithless. . . .
not in the faithful, as
Id. at 506, n.34.
It may be a rare case, indeed, where the Court finds directors to be unexculpated
on the basis of a failure to act in good faith without finding a breach of the duty of