Excerpt from "PLAINTIFFS' MEMORANDUM OF LAW IN OPPOSITION TO DEFENDANTS' MOTION FOR SUMMARY JUDGEMENT OF CERTAIN CLAIMS FILED ON 2/9/98" as submitted in United States District Court, District of New Mexico: "... As explained in detail in the Affidavits of William G. Hones and Dr. Edward W. Hones, Roy Harrigan's concept that to magnetically levitate a spinning body, it is necessary to have a dish-shaped base magnet or a base magnet with a magnetic field in which the magnetization vectors define a cone, is erroneous. After considerable experimentation and computer modeling conducted over a period of several months in an effort to implement the teachings of Harrigan?s patent, Bill and Ed Hones discovered that Harrigan?s basic concept was wrong. They discovered that one could use a flat base magnet magnetized perpendicular to its flat surface and still levitate a spinning top. That discovery is what led to the invention that made possible the commercialization of the Levitron® device by Plaintiffs within a matter of mere months. Bill and Ed Hones made that invention by themselves and without any participation of or assistance by Roy Harrigan. W. Hones Aff.24, E. Hones Aff.18. They filed a U.S. patent application for their invention and in that patent application they expressly referred to Roy Harrigan's patent and the erroneous teachings of that patent. W. Hones Aff.22. The U.S. Patent and Trademark Office granted them U.S. Patent No. 5,404,062 for their invention on April 4, 1995. Ex. 3 to W. Hones Aff. Under the Patent Laws, that patent is presumed to be valid. 35 U.S.C. §282... Even a cursory reading of the Harrigan and Hones et al patents by an experienced patent attorney would have revealed the clear distinctions and differences between the invention disclosed and claimed in the Harrigan patent and the invention disclosed and claimed in the Hones et al. Patent. Manbeck Aff.9. Defendants were also on notice of a letter from Plaintiffs' patent attorney, Saul Leitner, to Martin Simon which explained to Mr. Simon the very limited scope of the claims of the Harrigan patent and the right of anyone to design around the claims of an issued patent. Leitner Aff.5... " ************************* Excerpt from: AFFIDAVIT OF WILLIAM G. HONES "...I, William G. Hones, being duly sworn, hereby depose and say as follows 1. I am the vice president of Creative Gifts, Inc. ("Creative Gifts") and the president of Fascinations Toys and Gifts, Inc. ("Fascinations"), plaintiffs in the above-captioned civil action. I am also a plaintiff in the present action. 2. The facts stated herein are of my own personal knowledge. I am competent and willing to testify to their truth. 3. A primary mission of Plaintiffs Creative Gifts and Fascinations is to produce and market scientifically oriented toys. Toward that end, in late August 1993 I was reviewing a number of patents relating to toys that I had obtained from the U.S. Patent and Trademark Office in search of a new product for my companies. Among the patents I reviewed was U.S. Patent No. 4,382,245 issued to one Roy Harrigan of Manchester, Vermont which described a magnetic levitating top. A true and accurate copy of that patent is attached hereto as W. Hones Ex. 1. 4. After reviewing the Harrigan patent, I contacted Mr. Harrigan by telephone on August 25, 1993 to find out whether he had ever commercialized his device and if not, whether he had a design or could formulate a design that could be produced as a low cost novelty item. 5. Although he said had made some attempts to commercialize his device, Mr. Harrigan had never succeeded, but he was very interested in exploring that possibility with me. He invited me to come to Vermont for a demonstration of his device. I accepted his invitation and in the meantime sent him one of Fascinations? standard 5% royalty licensing agreements to review. 6. Prior to visiting with Mr. Harrigan, I contacted a magnet supplier, AEC Magnetics, to determine the feasibility of manufacturing a concave or dish-shaped base magnet as shown in Figure 1 of the Harrigan patent. Mr. Bill Klaus of AEC Magnetics advised me that the tooling costs and the costs to design and manufacture a magnetizing device for a dish-shaped base magnet would probably be prohibitive for a magnetic novelty product. 7. In September 1993 I visited Roy Harrigan at his home in Manchester, Vermont to discuss how Fascinations and he could work together to commercialize his levitating device. We discussed the theory of operation of his device and ways to implement his invention. He also demonstrated the operation of his device as disclosed in his patent and let me borrow a prototype to examine. 8. By a letter dated December 22, 1997, Mr. Harrigan?s attorney, Michael Vary, provided my attorneys with an excerpt of what is purported to be a transcription of a recorded portion of the discussions I had with Mr. Harrigan during my meetings with him in September 1993. A copy of that excerpt is attached hereto as W. Hones Ex. 2, where R is said by Mr. Vary to refer to Roy Harrigan and M is said to refer to me, Bill Hones. 9. Although Mr. Vary has refused to provide my attorneys with a complete transcript or a copy of the video recording from which the excerpt of W. Hones Ex. 2 was purportedly taken to verify its accuracy, the attached excerpt shows that it was Mr. Harrigan's belief that in order to achieve magnetic levitation of a spinning top, the magnetization vectors of the base magnet would have to define a cone as do those of the dish-shaped base magnet shown in his patent. In other words, regardless of the surface profile of the base magnet, even if it were flat, Mr. Harrigan maintained that the base magnet had to be magnetized so that the vectors of magnetization defined a cone. 10. During my meeting with Mr. Harrigan, I informed him that my father, Ed Hones, a retired physicist, could assist in better understanding the physics of the levitating device so that we might be able to produce a commercially viable product. Mr. Harrigan was very interested in working with us and I suggested he sign the license agreement I had sent him. Mr. Harrigan declined to sign the agreement because he said he wanted to have it reviewed by his attorney. 11. When I returned to Seattle, I obtained a number of flat plastic magnetic sheets and began working on trying to develop ways to form them into a dish-shaped magnet. I shaped the flat magnets on the inside of a bowl and heated them in an oven to try to make them retain a dish shape. In the meantime, my father began studying the literature and various texts pertaining to permanent magnets and, particularly, magnetic shells, to learn about the magnetic fields of such shells, especially the magnetic fields of dish-shaped or spherical shells. 12. On about September 27, 1983, I requested information from a magnet company, Flexmag Industries, about the availability of spherical or dish-shaped magnets and again was discouraged to find that such magnets were not available as off-the-shelf items. 13. In October 1993 I performed several experiments with the plastic magnetic sheets I had purchased and formed into dish-shaped shells to determine the orientation of the magnetic field of those shells. The result of those experiments caused me to begin to doubt the validity of the concept of magnetic focusing by the cone-shaped distribution of magnetization vectors that Harrigan described in his patent and in my discussions with him in early September 1993. 14. In October 1993 my father came across a passage in a text on theoretical physics that stated that uniformly and normally magnetized shells having identical peripheries and identical magnetization strengths produce identical magnetic fields regardless of their surface profiles. 15. Computer calculations by my father confirmed that the magnetic fields of flat and dish-shaped magnetic shells of the same strength and periphery are the same. 16. My father suggested that we should perform a test to confirm the completely surprising results of his calculations. To conduct such a test, I attempted to levitate a spinning top above one of the plastic magnets that was still flat, i.e. one that I had not yet formed into a dish-shape. To my astonishment I succeeded in levitating the top. 17. The result of that experiment left my father and me puzzled as to why Harrigan was so totally committed to a dish-shaped base magnet or to a base magnet of other shapes so long as it was magnetized to emulate a dish-shaped base magnet. 18. By the end of November 1993, we were convinced that Harrigan?s concept of a focusing effect with a dish-shaped base or a field with magnetization vectors that define a cone was erroneous. 19. Further calculations for flat and dish-shaped magnets were done in December 1993 and by January 1994 we had proved to ourselves that stable levitation of a spinning magnetic top could be accomplished with a normally magnetized flat base magnet, particularly one with a square periphery. 20. My father then drafted an invention disclosure explaining our discovery and how it differed from Harrigan's concept. We forwarded that disclosure to our patent attorneys in early February 1994 for preparation of a patent application. 21. During the period from my visit with Mr. Harrigan in September 1993 through December 1993 I contacted him on a number of occasions to inquire about the license offer Fascinations had made to him. He remained non-committal and never signed that agreement. In March 1994 I offered Mr. Harrigan a different agreement that would include royalty payments to him for working with Fascinations to develop other products, even though my attorney had advised me that his patent did not cover our invention. My offer would have paid him a 2 ˝% royalty on any levitating product we produced. He never responded to that offer. 22. The patent application for our invention was filed on February 17, 1994 and issued on April 4, 1995 as U.S. Patent No. 5,404,062, a true and accurate copy of which is attached hereto as W. Hones Ex. 3. At col. 1, line 62 to col. 2, line 7 of our patent, we specifically refer to the Harrigan patent and the dish-shaped magnet he describes in his patent. At col. 2, lines 27-52 of our patent, we describe the theoretical basis for our invention and distinguish it from Harrigan?s concept, especially by the statement at col. 2, lines 49-52, that "[m]aking the surface of the base magnet concave instead of flat does not provide a magnetic centering force above the base magnet." 23. In the claims of our patent, we distinguish our inventi0on over the Harrigan patent by reciting in independent claims 1 and 15 that the base (first) magnet has a substantially planar first surface and is magnetized normal (perpendicular) to that first or upper surface and parallel to the axis of the first magnet. 24. Roy Harrigan did not participate with my father and me in the conception or reduction to practice of the invention disclosed and claimed in our U.S. Patent No. 5,404,062. Nor did Mr. Harrigan make any contribution whatsoever to that invention. He is therefore not an inventor of the invention claimed in that patent. ?Further affiant sayeth not Date February 24, 1998 [signature] William G. Hones Sworn and subscribed before me this 24 day of February, 1998 [notarized] [signature] Cheryl E. Snow Notary Public