DEPARTMENT OF JUSTICE

Intra-Office Memorandum

Privileged and Confidential
Attorney Work Product
Prepared In Contemplation of Litigation

We received from ATG a letter and enclosures which are summarized in the attached letter to Dr. Blackwood. Dr. Blackwood telephoned me this morning with the following comments.

First, the methodologies, recommended by ATG and followed by our expert, are essentially identical. There is one critical point: those who wrote the (EPA) Method realized that if water is left lying around, microorganisms will grow in it. Therefore, if water is more than 48 hours old, it must be treated with ozone and UV to destroy those organisms, which otherwise interfere with observations. ATG called for modifying the procedure to eliminate the ozone-UV treatment "as this has been shown to negatively affect the IE crystal structures." It seems clear that the effect of the ATG modification would be to preserve microorganisms, which could then be mistaken for "IE crystals" or "structures." I believe my October 15, 1997 letter to ATG may have responded to this point, in indicating that one may well observe "structures" in tap water, but the identification of the structures is critical, and we believe the structures Dr. Lo observed and photographed are artifacts commonly found in carbon support films.

Second, the story keeps changing. ATG appears to be attempting to back off from its Ice VI language, saying, in effect, "We're really talking about clustering." Water molecule clustering is indeed a common phenomenon, but ATG has heretofore been making statements and representations using the term "crystal." They appear to recognize vulnerability on this language, in that "crystal" has an explicit meaning.

ATG's approach, to "demonstrate the presence of IE crystal" as refutation of our expert's findings, is misdirected. It wasn't just that our expert found no structures in certain locations, but that the lab found "structures" in several places, including tap water. I believe my October 15th letter addressed this point in noting that the issue of appropriate controls is critical: One may well observe "structures" in tap water. But the identification of those structures is a matter of specialized expertise. Finding "structures" again in water supplied by ATG would not "demonstrate the presence of the IE crystal" hypothesized by Dr. Lo to (mistakenly) explain his observations.

I will consider the matter further, but it isn't immediately clear, based on Dr. Blackwood's comments, that I should make any further response to ATG's October 14th letter and enclosures. It might be useful to let them know that we understand "clusters" are a common phenomenon, but that clusters are not "crystals" as that term is commonly defined.