Rosemary Foster
charged with capping clients in violation of ethics code, stealing,
breach of fiduciary duty
Rosemary Foster resigns from the Oregon Bar Association

 

Declaration of Daniel A. Bernath, Esq.
in Support of Default Prove up before Circuit Court Judge

STATE OF OREGON )
) ss.
)

County of Washington)

Daniel A. Bernath, Esq., being duly sworn sayeth as follows:

  1. I am an attorney at law and was admitted to the California Bar in 1984. I limit my practice to Social Security disability and as such can practice before that agency in all 50 states.
  2. I began to practice in this area in October 2005. I started out with zero clients. Now, after spending approximately $750,000.00 in advertising, office support staff and facilities I have approximately 3,669 clients in the states of Washington, Oregon, California, Idaho, Hawaii, Virginia, Texas and Nevada.
  3. My wife, Martha  , dba Northwest Disability Advocate and myself own the entity and I work for her and the entity Northwest Disability Advocates.
  4. We obtained over 3,000 clients by advertising on television, radio, newspapers, magazines, telephone yellow pages and word of mouth by happy former clients. These clients hide their disabilities from the public so you could not look into a directory to locate these clients/customers.
  5. We have brought aboard independent contractors to assist in intakes. An intake would occur when one of the three internet advertising agencies I contacted with would provide a prospect to me. The prospect would fill out a form and give the advertising all confidential information on their impairment, their work history, their contact numbers and information.
  6. In the beginning I would contact the prospects myself and do the intakes whereby I would evaluate if the client had a case. I would then begin a file and proceed to represent the client before the Social Security Administration with the ultimate goal of obtaining Social Security benefits for the client.
  7. As my practice grew it became necessary to contract with other people to act in the role of intake clerk.
  8. About two years ago, JoEllen Shannon telephoned me and offered her services.
  9. I trained her in what made a good Social Security Disability case and other law office procedures. Shannon is not, nor has she ever been a member of any state bar nor is she formally trained in the law. She would often call me "partner" and as I know that words have meaning and import, I would correct her repeatedly, "No, you are not my partner. I am a lawyer running his law practice and you are an independent contractor."
  10. As time went by, and because Social Security would permit a non-member of a state bar to actually present the case at a disability hearing, I would assign Shannon to act as the advocate before the administrative law judge, as a member of my law practice.
  11. At other times, it can to my attention that I could obtain benefits for my clients by making a motion for an "on the record(s)". The OTR as it is called, is like a summary judgment motion to SSA. I requested that Shannon contact specific clients to obtain the medical records and then I would compile the information and make the OTR motion. Because of the OTR assistance and intake assistance, JoEllen Shannon had access to all 3,669 of my clients.
  12. I was declared 100% disabled by the US Department of Veterans Affairs for a series of maladies and could not reliably attend or prosecute hearings. I fall asleep twice a day at least for up to an hour and cannot concentrate. My wife, Martha  , has taken over the operation of the entity and contacts with independent contractors to carry out the work she does not do.
  13. My wife and I thereafter, on January 28, 2011, hired attorney Rosemary Foster to be an attorney for me and my wife Martha to represent my clients and my interests before the Social Security Administration as part of an attorney client relationship/independent contractor.
  14. Because of that trust we had to put into Foster, we permitted her access to my 3,669 clients (Exhibit One to Complaint) and the data that was found in Needles case management software and the redundant paper files.
  15. Our trust in Rosemary Foster, Esq. was misplaced. It turns out that she is NOT a licensed attorney to practice law in Oregon but holds herself out as being a "member of the Oregon Bar." Her status at the Oregon State Bar is "suspended" and therefore she cannot practice law. Even though she is fully aware of her legal impairment to represent Oregon citizens before Courts and Administrative bodies of the State, she has illegally represented at least one case before the Oregon Department of Employment before an administrative law judge. (Exhibit Eleven)
  16. She was hired as an independent contractor to merely prosecute the cases we assigned to her and return the file to me for further processing (after our support staff had in-took the case, worked the case up, set it up for trial with witness statements and doctor statements, etc.).
  17. Social Security changed its rules so that an attorney working for an attorney would not be permitted to conduct a hearing. The hearing attorney had to have the client sign papers as The "representative." Therefore, we proposed and Rosemary Foster agreed, that all of my clients would sign agreements and social security documents so that Foster could conduct the hearings but that she was merely the "holding" attorney and that the law practice was my property and she was merely a hired hand independent contractor, i.e., attorney for my wife and I. (Exhibit Four)
  18. In the agreement Foster agrees to become  ’s attorney/advocate. The agreement Foster signed states that "the true owner of the cases, Martha  ." Foster agrees that the   clients that she comes in contact with are not the clients of Foster but that Foster is merely the "holding attorney" until such time as   becomes a certified Social Security advocate.
  19. Foster agreed that if any payments were made by Social Security on behalf of the clients for attorney fees that "this money is the property of   and not Foster."
  20. Indeed, in full compliance with the agreement with us, Rosemary Foster acted as our attorney and prosecuted 4 cases a month and sent us an invoice for $1,000 a month (which we promptly paid.) (Exhibit Two to complaint and Exhibit Two B invoices propounded by defendant Foster}
  21. On or about April 1, 2011, Social Security thereafter changed its rules so that we could no longer use Shannon, not a member of any bar, as an advocate and be paid attorney fees directly.
  22. When I informed Shannon about this she flew into a rage and said, "You can’t live without me. The practice is owned by Foster-not you!"
  23. I have in the file that Social Security has begun an investigation of JoEllen Shannon for stating she is a licensed attorney at law when she is not. {Exhibit 3}
  24. Thereafter, I telephoned Foster and asked if she had spoken to Shannon. Foster then demanded that she be paid $4,000 a month even though there was no new consideration. So as to not

    harm our clients by any further delay in their cases being presented we agreed to what amounted to extortion by Foster.

  25. Thereafter, on or about May 3, 2011, Foster determined that she would make a lot more money by simply stealing the entire law firm rather than get her $4000 a month and she informed me that she was quitting and would return "some" of our files.
  26. As part of Foster and Shannon’s attempts at theft, they have contacted the US Post Office and asked that any mail that was meant for me from my clients or from Social Security Administration be instead sent to them. I have reported this so called "false forwarding" crime to the US Postal Service Inspector Service and the FBI. (Exhibit Twelve)
  27. As further evidence of Shannon and Foster’s thefts, they have contacted a client of mine directly. Social Security Administration will send the attorney fee to me directly after takingit out of the claimant’s past due benefits. For example, the SSA may send the claimant $25,000 for his monthly disability that goes back to 2009 and carve out $6000 to me as attorney fees and send out two checks.
  28. But SSA made a mistake in the case of   Lucas. In the Lucas case, SSA did NOT withhold the attorney fee but in error sent it to the client. SSA stated that I had not signed up for the program for direct payment but of course I have indeed been on that program for 7 years.
  29. Lucas then telephoned a phone number he had and that phone number was actually the phone number of JoEllen Shannon of the Rosemary Foster Disability Law Practice (Exhibit Thirteen).
  30. JoEllen Shannon said, "send a money order to the Wells Fargo Bank in Beaverton into the xxxx xx xxxx account and that will take care of you paying your attorney fee bill." Of course, that is NOT my bank account and the money apparently was sent to the bank account of JoEllen Shannon. I have filed a police report and the initial investigation by Tigard Police Officer Julie Hicks is "no doubt this is a theft." (Exhibit Fourteen)
  31. Prior to getting news of this bald theft, I noted that Foster and Shannon had several files and demanded that they return all of them. They refused to return the files and still has in her possession the following paper files:

    Pemberton
    Payson
    Pool
    Stoffel
    Carillo
    S. Kircher
    Philbrook
  32. We then hired a new attorney to appear at my hearings for our clients. Charles  Q, Esq. came aboard as our attorney to appear at hearings with our clients.
  33. He arrived at a hearing in Seattle Social Security Court (ODAR) but the client was late. He waited in the lobby but when the client finally showed up. Foster stated that she was the attorney for the client to the entrance guard. While  Q was in the lobby waiting for the client, Foster had snuck into the SSA courtroom and announced that she was the attorney. The judge accepted that misrepresentation and the court clerk whisked our client past  Q into the locked courtroom and the hearing proceeded.
  34. There were three more hearings that day for our clients in Seattle. It was a strange sight in the lobby of the Social Security Administration court (ODAR) and a disgrace to the legal profession as  Q and Foster both waited for the clients to appear throughout the day. The second client of NW showed up on time and  Q conducted that hearing. (The OS Bar has an open case at this time for this professional capping inside and outside of a Courtroom in Seattle of Rosemary Foster)
  35. Foster remained in the lobby to solicit the other two clients but the disgusted Social Security management chased her out of the lobby.  Q then went down to the ground floor lobby and waited for our other clients. (Exhibit 4)
  36. Two other hearings were scheduled for that day but Foster sat in the lobby waiting to pounce on the clients to solicit them right in the Social Security Court’s lobby!
  37. Thereafter I learned that Foster had contacted other clients of mine, had gotten client information from our Needles™ case software and either personally or through her runner or capper JoEllen Shannon, told my clients that Foster was their lawyer-this even though she was merely an independent contractor who was assigned by me to appear at the hearing and had no ownership rights in the creation, development and presentation of the case.
  38. As of this date we have information that she has contacted these two other clients, solicited them illegally and expects to appear in court for their upcoming hearing in the next few weeks:
    Jason   (Exhibit 5A and 6B)
    Douglas Demain (Exhibit 6A and 6B)
  39. Rosemary Foster and JoEllen Shannon have actively been soliciting client Douglas Demain. He received "paperwork" from Foster and Shannon to make them his lawyer. Charles  Q, attorney assigned by myself and   to handle this case has the "file" but Foster and Shannon have made paper copies of these HIPAA protected documents and are using them to solicit this client to take his case. They know that he is mentally disturbed by reading the medical records and are using that knowledge stolen from the file to solicit his case, in violation of the Oregon Rules of Professional Conduct. Foster and Shannon are directly targeting the clients of plaintiffs which they have gleaned have mental issues because with their weakened minds they are more likely to be confused by the Foster/Shannon thefts.
  40. JoEllen Shannon telephoned Demain and told him to "throw away" any papers that show that NW and/or  Q is his attorney. Again, defendants Foster and Shannon are intentionally targeting plaintiffs’ clients with mental problems as they are so weak of mind that they would go along with the solicitation by Foster and Shannon.
  41. Defendants are specifically targeting plaintiffs’ clients who are mentally ill or have weak personalities against their strong, overbearing and unethical solicitations. As such, these helpless clients need this Honorable Court’s protection.
  42. Jason  ; JoEllen Shannon and Rosemary Foster and contacted this client, solicited his legal business and told them that Foster is his lawyer and that NW and  Q is not. All these acts by Foster and Shannon are illegal and unethical.
  43. Other illegal acts including the taking and transmitting amongst themselves and others the medical records and social security numbers of clients.
  44. Social Security numbers are sold like currency to illegal aliens and a valid Social Security number can sell for up to $1,000. Foster and Shannon had access to 3,660 for a total potential fencing deal if they could sell the numbers and if they obtained them of $3,660,000. When defendants were trusted they had access to the many thousand social security numbers. As stated earlier, that security breach has been closed by blocking Foster and Shannon from accessing the Needles case management software. The average profit from each client/customer acquired and worked up for hearing and beyond is $3,000 profit. Therefore, with the theft of the client list consisting of names, social security numbers, confidential medical information, attorney notes, correspondence with SSA, etc., is a loss to my wife and I of approximately $11,700,000.00 in profits/attorney fees.
  45. Also illegal is their use of clients’ confidential medical records. The HIPAA Privacy Rule regulates the use and distribution of identifiable health information and gives individuals the right to determine and restrict access to their health information. Substantial penalties, both civil and criminal, may be imposed for non-compliance such as the theft by Foster and Shannon of confidential client medical information.
  46. Furthermore, as seen from the declaration of clients who were contacted by Shannon to solicit legal business for attorney Rosemary Foster, the clients becomes dangerously upset and requires additional and intense medical intervention with the administration of new and more powerful quantities of drugs.
  47. Foster and Shannon are using this information that plaintiffs’ clients are fragile in body and mind and are using that to solicit their business in violation of law. Defendants are barging into clients’ fragile existence to gain some money, calling them after business hours, on weekends so that they cannot call their attorney for days. In contrast, each and every client of plaintiffs became a client ONLY because they sought out legal advice from plaintiffs and stated that they wanted to meet with plaintiffs.
    I declare under penalty of perjury under the laws of the State of Oregon that the foregoing is true and correct and was made from my own personal knowledge and that this declaration was made in Tigard Oregon on November 10, 2011.

Further, affiant sayeth naught.
Daniel A. Bernath, Esq.
Attorney at Law
California Bar Member 116636