IN THE UNITED STATES DISTRICT COURT DISTRICT OF NEW MEXICO CREATIVE GIFTS, INC., FASCINATIONS TOYS & GIFTS, INC., and WILLIAM HONES Plaintiffs, CIV.97 1266 LH/WWD v. UFO, MICHAEL SHERLOCK, KAREN SHERLOCK Defendants. EXPERT REPORT OF DR. PETER CAMPBELL Pursuant to Rule 26(a)(1)(B) 1. I am Dr. Peter Campbell, President of Princeton Electro-Technology, Inc., whose offices are at 5874 NW 32nd Way, Boca Raton, Florida 33496. I received a B.Sc. degree in 1970 and a Ph.D. degree in 1975, both in electrical engineering and from the University of Warwick in England, and a M.A. degree in 1974 from the University of Cambridge in England. From 1973 to 1977, I was an Assistant Lecturer in electrical engineering at the University of Cambridge, England, and concurrently was a Fellow of Downing College, Cambridge. From 1977 to 1981, I was an Assistant Professor of Electrical and Mechanical Engineering at the University of Southern California, in Los Angeles. I was then employed by PA Technology, a consulting firm in Princeton, New Jersey, as Vice President of Electrical Engineering from 1981 to 1983, and as President from 1983 to 1985. Since 1985, I have been President of my own consulting firm, Princeton Electro-Technology, Inc. 2. I have considerable experience in the field of magnetics. This experience has included the design and development of many commercial electromagnetic and electromechanical devices, most particularly those incorporating permanent magnet materials. I consult widely throughout industry on the design and application of permanent magnets. 3. Attached as Exhibit 1 is my curriculum vitae, which includes a list of publications which I have authored. There are three prior cases in which I have testified as an expert witness: for Fonar Corporation vs. Hitachi, Ltd., for Tridus International, Inc. vs. Duonetics, Inc., and in the early '80s on behalf of Chloride, Inc. My standard consulting fee which I am receiving for my work in this matter is $1,200 per day. No part of my compensation depends upon the outcome of this matter. 4. In my testimony, I expect to offer an explanation as to why the levitation device disclosed in U.S. Patent No. 5,404,062 is different and of greater commercial value than the levitation device disclosed in U.S. Patent No. 4,382,245. Additionally, it will include an explanation of why Mr. Harrigan did not contribute to the new features disclosed and patented in U.S. Patent No. 5,404,062. 5. I have reviewed the following materials: a. U.S. Patent No. 5,404,062, to Hones et al. ("Hones Patent"); b. U.S. Patent No. 4,382,245, to Harrigan ("Harrigan Patent"); c. Excerpts of what is purported to be a transcription of a recorded portion of a meeting Mr. William Hones had with Mr. Roy Harrigan during September 1993, and the letter from Mr. Harrigan's attorney to which the excerpts were attached. d. An article written by defendants on their levitron.com website entitled "The Hidden History of the Levitron"; e. Affidavits of Dr. Edward Hones, Mr. William Hones and Mr. Harry Manbeck prepared for submission in support of Plaintiffs' Opposition to Defendants' Motion for Summary Judgment. f. Page 412 from a publication entitled "Electrostatics and Magnetostatics" which I understand Dr. Hones came across in October 1993; g. An audio tape (approximately 30 minutes in duration) which purportedly has recorded thereon a telephone conversation between the Sherlocks and Mr. Roy Harrigan conducted on June 20, 1997; and h. A video tape which purportedly has recorded thereon a clip showing Mr. Harrigan's prototype from about 1993 (of approximately two minutes duration) and an interview of Mr. Harrigan conducted by the Sherlocks in June 1997 (of approximately thirty minutes duration). 6. Based on my review of those items and my extensive experience in the field of magnetics, I have the conclusions set forth in the following paragraphs. 7. The Harrigan Patent discloses a levitation device having a dish-shaped lower magnet which has a concave surface uppermost, such that the directions of magnetization throughout this magnet converge at a point. >From the disclosure of the Harrigan Patent and the statements of Harrigan purportedly memorialized on the video tape, audio tape and typed excerpts, it is clear that Harrigan's theory of operation of his levitation device was that, however the lower magnet was formed, it was required to have the magnetization vectors angled inwards in this way, as if defining a cone. That is, a dish-shaped lower magnet would have to be magnetized exactly normal to its concave upper surface at e every point across this surface; a rigid flat lower magnet would have to be magnetized at a different angle at every point across its upper surface, never normal to the surface except at its geometric center. 8. The Hones Patent discloses a levitation device having a lower magnet which has a substantially planar surface uppermost, such that the magnetization vectors throughout this magnet are directed normal to this upper surface. This most important feature, namely, a magnetic field magnetized normal to that planar upper surface, is absent from the Harrigan Patent and the other statements of Harrigan which I have reviewed. Specifically, Harrigan has always taught a device wherein the magnetization vectors in the lower magnet are angled inwards as if defining a cone, regardless of the construction of the lower magnet; the Hones Patent dispels that theory, disclosing that magnetization normal to the surface of a planar lower magnet may be used. 9. Hones' findings are important from a commercialization aspect, as they allow for the use of a less expensive flat magnet. It is my opinion that, to produce a dish-shaped lower magnet as taught by the Harrigan patent that is magnetized normal to its concave upper surface at every point across this surface would require complex and costly tooling; to produce a rigid flat lower magnet as suggested by Harrigan that is magnetized at a different angle at every point across its upper surface would also require complex and costly tooling. It is my opinion that, to produce a rigid flat lower magnet as taught by the Hones Patent that is magnetized normal to its planar upper surface is both simple and cheap. The costs of producing a dish-shaped magnet magnetized normal to its concave surface according to the teachings of Harrigan would be substantially greater than the costs of producing a flat magnet magnetized normal to its flat surface as taught by the Hones Patent. Thus, it is my opinion that the device disclosed in the Hones Patent is a much more commercially viable product than the device disclosed and described by Harrigan. 10. In my opinion, the Harrigan Patent and Harrigan's recorded statements have always taught a levitation device wherein the magnetization vectors in the lower magnet are angled inwards as if defining a cone, regardless of the shape of the lower magnet; this is an empirical finding, for which Harrigan has provided no theoretical basis. On the other hand, it is my opinion that the Hones' Patent and Affidavits demonstrate that they have developed a good theoretical understanding of magnetic levitation, which has led them to devise a more practical and commercially viable levitation device that is not constrained by Harrigan's requirement for the magnetization to be angled inwards. 11. In my opinion, the device disclosed in the Hones Patent is distinct from, and in a commercial sense superior to, the device disclosed in the Harrigan Patent. 12. To the extent additional information is brought to my attention during the course of this proceeding, I reserve the right to supplement this report. Date: 3/18/98 [signature] Dr. Peter Campbell