Free Statement - District Court of Arizona - Arizona

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JABURG & WILK, P.C. ATTORNEYS AT LAW 3200 NORTH CENTRAL AVENUE SUITE 2000 PHOENIX, ARIZONA 85012

Roger L. Cohen, #004409 Kathi Mann Sandweiss, #011078 JABURG & WILK, P.C. 3200 North Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 Attorneys for Defendants Ross

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA SHIMKO & PISCITELLI, et al., Case No: CIV-04-78-PHX-FJM Plaintiffs, DECLARATION OF RICHARD ROSS v. DAVID GOLDFARB; RICHARD ROSS, et al. Defendants.

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I declare as follows: 1. I am a named Defendant in the above referenced matter. All matters

stated herein are known by me to be true. 2. In or about 2000, Plaintiffs Shimko & Piscitelli, an Ohio law firm,

and attorney Timothy Shimko (collectively, "Shimko") began representing a group of limited liability companies (the "CORF Entities") in connection with their business operations. In or about Fall, 2001, the CORF Entities retained Shimko as counsel in a series of filed or threatened lawsuits. The CORF Entities requested that Shimko also defend my wife and me, and the other officers, employees and their spouses named in any such lawsuits, at the expense of the CORF Entities. There was no written fee agreement.

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JABURG & WILK, P.C. ATTORNEYS AT LAW 3200 NORTH CENTRAL AVENUE SUITE 2000 PHOENIX, ARIZONA 85012

3.

Shimko failed to advise me of the potential conflicts involved in his

simultaneous, joint representation of the CORF business entities, its officers and employees, the general partner and limited partners. 4. Shimko failed to advise me that my wife and I might have different

interests and conflicts with the general partner and officers and employees. Shimko failed to advise me that my wife and I might have conflicts with the other defendants and different interests than the other defendants, depending upon such matters as our respective personal assets and financial situations, how the assets were held, our respective levels of involvement in CORF activities and promotions, and our respective knowledge of activities at CORF. 5. Shimko failed to explain to me that he could not make a separate

settlement on behalf of my wife and me, because doing so would conflict with his duty of loyalty to his other clients. I never waived this and other potential conflicts because I was never advised of them. 6. Shimko failed to advise me of the risks and potential conflict

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involved in his representation of multiple clients with different levels of involvement and potential culpability. Shimko failed to advise me that my wife and I might have

conflicting interests and should seek independent counsel even though some of the other clients Shimko represented continued to engage in activity that Shimko had warned them against. 7. As further set forth in the Woodcock Defendants' Motion, Shimko

testified that he attended dinner with the lead attorney for plaintiffs in the underlying CORF-related lawsuits, and that the attorney was offering to drop lawsuits against Brill and Ritchie, who had been CORF officers and employees. Shimko did not engage in negotiations for a separate settlement on my behalf because that would have conflicted with his duty to the other individual defendants. 8. With respect to the loan Shimko made to the CORF business entities,

as described in the Woodcock Defendants' Motion, Shimko failed to explain to me that 2
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JABURG & WILK, P.C. ATTORNEYS AT LAW 3200 NORTH CENTRAL AVENUE SUITE 2000 PHOENIX, ARIZONA 85012

some debts to him were corporate, and some were purportedly personal; he failed to explain how he would allocate monies he received from CORF between his legal bills and loan repayment. By applying monies received from CORF preferentially to repayment of the loan, Shimko increased the risk that CORF would be unable to pay legal bills, thus increasing the risks that my wife and I would be charged with payment. The loan transaction and risks were not explained to me, and my interests were materially affected. Shimko failed to obtain my written consent to the loan transaction. 9. With respect to the August 2002 transaction between Shimko and the

tissue bank business, as described in the Woodcock Defendants' Motion, Shimko failed to advise me to have independent counsel review the transaction and operating agreement, even though Shimko provided legal services to Aztec Medical Group Partners, LLC, in exchange for an interest in the company. Shimko failed to obtain my written consent to the transaction. 10. With respect to the demand that defendants pledge their homes as

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collateral in April, 2003, as set forth in the Woodcock Defendants' Motion, Shimko failed to warn me that if my wife and I knowingly and willingly pledged our home we potentially waived our homestead exemption. Shimko failed to advise me to seek the advice of outside counsel. 11. Even though, as set forth in the Woodcock Defendants' Motion,

Shimko testified that from the beginning of his representation, his clients' greatest concern was their exposure to personal liability, Shimko never made any effort to learn about my assets, how they were held, and their vulnerability to a judgment. I certify under penalty of perjury that the foregoing is true and correct. DATED this 31st day of March, 2008.

/s/ Richard Ross Richard Ross 3
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